Sensex Set for Strong Start amid BJP Victory, Energy Reforms
Indian stock markets are likely to witness a gap up opening on Monday on the back of positive global cues and a slew of reforms announced by the government over the weekend. Nifty futures on the Singapore Exchange traded 123 points or 1.57 per cent higher at 7,942 as of 08.10 a.m. indicating large gains for equities.
Here are the reasons why markets will rally today,
1) The BJP has won elections in Haryana and has emerged as the single-biggest party in Maharashtra. The victory in the two states will help the BJP move towards a majority in the Rajya Sabha. The government needs a majority in the Rajya Sabha to pass legislation.
2) The Modi government finally got down to serious work on the economic front. On Saturday, it decontrolled diesel prices, a move that will help further ease inflation and bring down the government's subsidy burden.
3) Diesel deregulation will significantly reduce subsidy payouts by state-run companies such as ONGC, GAIL (India) and Oil India. Shares in oil market companies such as Indian Oil, BPCL and HPCL are likely to open higher.
4) Private players such as Reliance Industries and Essar Oil will also benefit from the move to end subsidy on diesel prices.
5) The government also raised the cost of natural gas, a move that will attract investment in the energy sector. The new gas price of $5.61 per mmBtu will be effctive from November 1.
6) The hike in gas prices is smaller-than-expected, but the positive aspect is prices will be revised after every six months. The previous government had suggested for raising domestic gas prices to $8.4 per mmBtu from the current $4.20 per mmBtu.
7) About 80 per cent of the additional revenue due to revision in gas prices will go to state run companies ONGC and Oil India.
8) Reliance Industries will not get the benefits of the price rise for gas produced from its KG-D6 block as it is currently locked in arbitrations with the government over a sharp fall in production. RIL will deposit the differential between $5.61 and $4.20 in a separate account until the arbitration is resolved, said Oil Minister Dhramendra Pradhan.
9) Global cues have turned positive, with Japan's Nikkei rallying over 3 per cent today. Global equity markets rebounded on Friday, with European stocks surging the most in more than two years. Expectations among some investors that the European Central Bank will increase stimulus buoyed sentiment.
10) Wall Street followed Europe's lead, with the Dow Jones index rising 263 points on Friday. US stocks climbed more than 1 per cent after earnings reports eased concerns about the impact of weak global demand on US growth and businesses.
(With inputs from Reuters)
-
Talking Points This Week: Tech Nerves, FII Buying, And A Faraway Banking Shock
The global markets are not shining this Diwali. The exception in the large markets is, India.
-
Midterm Rally Lasted A Day. The Hard Reality Of A Divided US May Last Two Years | Opinion
Between a contested AI boom, a debt ceiling that arrives in 2027 and a president with every incentive to act alone, the next two years may prove more volatile than the first day's rally suggests.
-
Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era | Unhedged Position
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
