The recovery in the past few weeks helped the market reach a three-month high on July 28, adding more than Rs 19 lakh crore to the investors' coffers.
The benchmark indices on Thursday had a strong gap-up opening of 450 points on the BSE Sensex and 130 points on the Nifty50, following a rally in US markets overnight. This came on the back of the Federal Reserve delivering along expected lines, raising interest rates by 75 bps to tame inflation that crossed 9 percent in June. However, with slowing growth, this time the Fed seems more balanced in its approach.
The BSE Sensex rallied more than 1,000 points to 56,858, taking the total recovery to a little more than 3,800 points in July, while the Nifty50 crossed initial hurdles of 16,800-16,900 levels, closing 288 points higher at 16,930.
"Markets took comfort from the fact that the Fed's statement was more balanced this time. The fact that the Fed's statement started with an acknowledgement of slowing growth, indicates that the fed is turning increasingly attentive to growth risks as well. This resurrected the ‘FED PUT’ – an expectation that the Fed will stop and then dial back rate hikes if the economy slows down materially," said Pankaj Pathak of Quantum Mutual Fund.
The stability and rangebound trade in oil prices, slowdown in FII selling, fall in the US dollar index, sequential decline in CPI inflation, cooling of commodity prices, etc., also supported the market’s momentum.
With Thursday's rally, the market reached the highest level since May 2 this year, surging more than 11 percent from June lows and over 7 percent in the month of July.
With this, investors' wealth increased by Rs 19.37 lakh crore in the current month as the BSE market capitalisation reached Rs 263.1 lakh crore on Thursday, against Rs 243.73 lakh crore on June 30.
In fact, since the lows of June, investors’ wealth has grown by more than Rs. 28 lakh crore. The BSE market cap had fallen to Rs 234.86 lakh crore on June 20, the lowest on a closing basis after several months.
The rally was supported by every sector, with IT being the biggest gainer with a 2.5 percent rally followed by BSE Finance, which gained 2.2 percent. Bank and metal indices gained more than 1.7 percent each, while utilities and power climbed more than 1 percent.
Buying was also seen in the broader space but frontliners underperformed. The BSE Midcap and Smallcap indices gained nearly 1 percent and 0.65 percent respectively as the market breadth was not very strong on a day of strong momentum. About 1,909 shares advanced against 1,429 declining on the BSE.
More than 100 stocks hit a 52-week high on Thursday against 30 shares at a 52-week low, while more than 260 stocks were at the upper circuit against 166 stocks at the lower circuit on the BSE.
Stocks that hit a 52-week high included Astra Microwave Products, Bharat Electronics, ITC, PVR, Schaeffler India, Shoppers Stop, and West Coast Paper Mills. Adani Total Gas, Blue Dart Express, Coromandel International, Hindustan Aeronautics, Inox Leisure, Navin Fluorine International, Page Industries, Timken, Campus Activewear, Fiem Industries, and Insecticides India also hit a record high.Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.