Stock Market Today: Sensex, Nifty Continue Rally For Second Day; Here's Why
Brent crude fell 6.5 per cent over the past four sessions, reaching its lowest level since December 2021, while WTI dropped 5.8 per cent, marking its weakest point since May 2023
The Sensex and Nifty 50 maintained their recovery on Thursday, extending early gains to close in positive territory for the second consecutive day. The rally was fueled by strong performances from index heavyweight Reliance Industries, along with support from other crude-sensitive stocks like Asian Paints and BPCL.
At the close of trading, the Sensex gained 609.86 points, or 0.83 per cent, to reach 74,340.09, while the Nifty rose 207.40 points, or 0.93 per cent, to end at 22,544.70. Advancing shares outnumbered decliners, with 2,857 stocks rising, 979 falling, and 104 remaining unchanged.
Decline In Crude Price
Crude oil prices dropped sharply after OPEC+ announced plans to gradually reverse its voluntary production cuts. The oil-producing group intends to restore 2.2 million barrels per day (mbpd) of supply over the next two years, which accounts for 38 of the 5.9 mbpd cuts implemented since 2022.
In response, Brent crude fell 6.5 per cent over the past four sessions, reaching its lowest level since December 2021, while WTI dropped 5.8 per cent, marking its weakest point since May 2023.
The decline in crude prices benefited several rate-sensitive sectors that rely on the commodity as a key raw material. Lower oil prices provide these companies with an opportunity to boost profits through reduced input costs. As a result, stocks like Asian Paints and BPCL surged 3-5 per cent, becoming some of the top gainers on the Nifty.
Sectorial Update
On the sectoral front, the Nifty Metal index led the charge, jumping nearly 3 per cent, followed by the Nifty Energy and Nifty Oil and Gas indices, both of which rose over 2 per cent. Other notable sectoral gainers included Nifty FMCG, Nifty Media, and Nifty Pharma, which all saw gains of 1-2 per cent.
Banking stocks recovered from an early decline, driving the Nifty Bank index up by 0.3 per cent. This recovery in financial stocks was supported by the Reserve Bank of India's ongoing measures to inject liquidity into the banking system. The RBI announced open market purchases of government securities and USD/INR swaps of Rs 1.9 lakh crore. This followed the central bank’s February 28 decision to conduct a $10 billion swap to boost long-term liquidity, which saw strong demand.
Broader Market
The broader market showed strength as well, with the BSE Smallcap index rising nearly 2 per cent and the BSE Midcap index climbing almost 1 per cent.
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