The benchmark equity indices rebounded on Monday, with the Sensex rising over 400 points and the Nifty nearly reclaiming the 24,700 mark, supported by gains in metal and auto stocks and positive cues from Asian markets.
Sensex gained 418.81 points or 0.52 percent to settle at 81,018.72. During the day, it climbed 493.28 points or 0.61 percent to hit an intraday high of 81,093.19. The Nifty jumped by 157.40 points or 0.64 percent to close at 24,722.75. In the intraday session, it rose 169.3 points or 0.6 percent to hit a high of 24,736.25.
Hero MotoCorp, Bharat Electronics, Tata Steel, Eicher Motors and Hindalco Industries were among the major gainers, rising up to 4 percent.
Key factors behind market rebound today
1) Gains in auto shares: The shares of automakers recorded significant gains on August 4, as strong July sales and Q1 earnings boosted investor sentiment. The sharp rally in the share prices pushed the Nifty Auto index up more than 1.5 percent, emerging as the top sectoral gainer on the market today.
2) Metal stocks rise: The Nifty Metal index rose 1.6 per cent. Fourteen of the index’s 15 constituents traded in the green, as a softer US dollar made commodities more attractive for overseas buyers, supporting metal prices and driving sectoral gains.
3) Positive global cues: South Korea's Kospi, Hong Kong's Hang Seng, and Shanghai's SSE Composite Index traded higher. Additionally, US stock futures were trading in the positive territory during Asian hours, hinting at a firm opening for Wall Street.
4) Crude oil declines: Crude prices edged lower, providing relief to inflation concerns. The global benchmark Brent crude declined 0.23 percent to USD 69.51 a barrel, which is seen as a positive trigger for oil-importing economies like India.
5) Morgan Stanley sees new highs for Indian markets: Global brokerage Morgan Stanley on August 4 issued a positive note for Indian equity markets, stating that benchmark index Sensex can hit the key 1 lakh-mark by June 2026 in a bull case. The firm cited several potential triggers for the rally.
On the technical front, Anand James, Chief Market Strategist at Geojit Financial Services, said, "With over 30 percent of Nifty 500 stocks closing below their respective lower Bollinger Bands, markets are approaching oversold levels from where a rebound is likely. However, if pullback attempts fail to sustain above 24,670, the Nifty may slip towards 24,450–24,000 levels."
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