Sensex, Nifty extend rally to fourth day amid liquidity push, positive global cues

Markets rally as RBI rate cuts fuel momentum

Indian benchmark indices Sensex and Nifty maintained strong upward momentum during the afternoon session on June 6, supported by broad-based buying across sectors and favourable global cues. Notably, broader market indices outperformed the headline indices, signaling robust participation across market segments.

Around noon, the Sensex had risen by 342.33 points or 0.42 percent to 82,531.32, while the Nifty gained 113.60 points or 0.45 percent to reach 25,116.65. Market breadth was firmly positive, with 2,514 stocks advancing, 1,074 declining, and 137 remaining unchanged.

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Among the sectoral indices, Nifty Private Bank emerged as the top gainer, buoyed by strong gains in HDFC Bank, Kotak Mahindra Bank, and Axis Bank. The extended rally in banking stocks followed the Reserve Bank of India’s recent policy surprise, which included a 50 basis point rate cut and a 100 basis point reduction in the Cash Reserve Ratio (CRR).

However, the Nifty Realty index, which had surged in the previous session, slipped into negative territory on account of mild profit booking.

Market expert Ambareesh Baliga remarked that the RBI policy announcement was unexpected but largely positive for the equity markets. He pointed to the rally in banking and realty sectors as evidence of how rate-sensitive segments responded to the central bank’s policy easing. According to Baliga, the market had been consolidating within a broad trading range of Rs 23,800–24,000 on the lower side and Rs 25,200 on the upper side.

“We are currently at the higher end of that band, and if we manage to break above it, we could see further gains, driven primarily by liquidity inflows,” he said. However, he also cautioned that while corporate earnings have been mixed, the Nifty at 25,000 is not necessarily justified by fundamentals, implying that momentum and liquidity remain the dominant forces behind the rally.

Echoing an optimistic tone, Sameet Chavan, Head of Research, Technical and Derivative at Angel One, said the overall technical setup for Indian equities remains strong. He advised investors to adopt a ‘Buy on Dips’ strategy at the current juncture.

“In terms of specific levels, the Nifty50 index is eyeing the 25,300 zone, which corresponds to the 78.60 percent Fibonacci retracement level, making it a critical zone to watch in the coming sessions,” Chavan noted. On the downside, he identified the Rs 24,800–24,750 range as a key support area that could cushion the index against any short-term pullbacks.