Sensex jumps 700 pts as bulls shrug off Trump policy jitters; global cues among key factors taking markets higher

Sensex jumps 600 pts as bulls shrug off Trump policy jitters; global cues among key factors taking markets higher

Stock market benchmark indices surged on Monday, with the BSE Sensex climbing 699.61 points or 0.90 percent to 77,318.94, as investors shrugged off jitters around US President-elect Donald Trump’s policy stance.

The NSE Nifty rose 187.9 points or 0.80 percent to 23,391.10, buoyed by strong global cues and a sharp rally in banking stocks, led by Kotak Mahindra Bank.

The swearing-in of Trump and his assurances of a positive dialogue with China added to the optimism, helping markets advance for the day.

Key Factors Driving Monday’s Rally

1. Trump Policy Concerns Eased: Global markets reacted positively to Trump’s announcement of a "very good" conversation with Chinese President Xi Jinping, which signalled a potential easing of trade tensions. US markets closed in the green on Friday, while Asian indices such as the Hang Seng and Nikkei 225 also posted gains. "Trump’s softer stance on tariffs, at least initially, is likely to keep market sentiment intact," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

2. Banking Stocks Drive Rally: Banking stocks were the key drivers of the rally, with Kotak Mahindra Bank leading the charge. Shares of the lender jumped over 9 percent after it reported a 10 percent growth in consolidated net profit at Rs 4,701 crore, aided by strong performance from its capital markets-linked arms. The Nifty Bank index surged over 2 percent, with 11 out of its 12 constituents trading in the green.

3. Rupee Appreciation: The Indian rupee appreciated by 14 paise to 86.46 against the US dollar, tracking gains in domestic equities and strength in Asian currencies. The dollar index, which measures the greenback's strength against six major currencies, declined by 0.22 percent to 109.10. Brent crude oil prices remained steady, falling slightly by 0.12% to $80.69 per barrel, adding to the market’s positive sentiment.

Technical Insights

Market analysts highlighted the importance of key resistance levels on the Nifty. Anand James, Chief Market Strategist at Geojit Financial Services, said, "though the 23000 region diffused a massive bearish plunge, the technical structure of the recovery wave that had been in the making all through last week, appears dismantled. And yet, with more Nifty 50 stocks closing above their respective 10 day SMA on Friday than Thursday, despite Friday’s red candle, we are inclined to hope for a push higher."

"While we continue to view 23370/90 as the level to beat, 23550-640 objectives continue to appear possible. We will begin the day eying 23270-140 as the initial range to break, before a directional move is set," he added.

Nifty Defence index was trading 2.43 percent higher with all its 16 constituents trading higher today.

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