Nifty Rises 1%, Sensex Surges Nearly 900 Points: Five Reasons Why Stock Market Is Rising Today

The Indian stock market snapped three day losing streak to rise over 1% on Wednesday, buoyed by positive global cues and surge in PSU bank and metal stocks.

The Nifty 50 surged 1.20% to hit 26,195.40, while the Sensex climbed over 950 points to 85,582.40. This comes after the Asian market mirrored the gains in the Wall Street.

Nifty recovered 350 points from the day's low and is just 90 points away from its all-time high as of 1:19 p.m.

"Global sentiment remains constructive, supported by expectations of a potential U.S. rate cut and broadly stable Asian markets, keeping the overall tone cautiously optimistic," said Hitesh Tailor, Research analyst, Choice Broking.

Volatility index VIX had fallen over 4% at 1:00 p.m.

US retail sales came in weaker than expected on Tuesday, and consumer confidence softened, increasing hopes that the US Federal Reserve may cut rates in December.

Two Fed officials also signalled support for a rate cut.

Japan led Asian gains, with Topix rising 2%. The S&P 500 also posted strong gains on Tuesday, with the Dow adding over 300 points and the Nasdaq up 0.64%.

Asian indices mostly followed suit— Australia’s ASX 200 gained 0.81%, Hong Kong's Hang Seng rose 0.3% and Taiwan’s Taiex rallied nearly 2%. However, China’s Shanghai Composite remained flat, down 0.15%.

The NSE Nifty Bank index rose 1.18% to a new high of 59,515.30 apiece. The index has risen 13.89% in 12 months.

HDFC Bank Ltd. and Axis Bank Ltd were top contributor to the index.

The NSE Nifty PSU Bank index rose 1.80% to a new high of 8,638.30. With Indian Overseas Bank, Punjab and Sindh Bank, and Bank of India among the top gainers in the index.

Metal stocks also witnessed a sharp uptick in Wednesday’s trade, signaling renewed investor confidence in the sector. Leading the rally were prominent names such as SAIL, APL Apollo Tubes, Jindal Stainless, Tata Steel, Hindustan Zinc, Vedanta, Hindalco Industries, and JSW Steel, all posting gains across the board.

The NSE Nifty Metal index advanced 1.86% at intraday ad the index hit a 10,096.05 mark.

The Nifty Midcap 100 and the Nifty Smallcap 100 also gained over 1%, showing strong participation beyond frontline stocks. While, Natco Pharma led the surge in SmallCap index, L&T Finance and SAIL led the gains in Midcap index.

Oil prices edged up with Brent crude at $62.55 and WTI at $58, after closing at one-month low on signs of Ukrainian peace deal getting closer. This move could remove the curbs on Russian crude just as global glut loomed.