Sensex jumps 2,700 points in 3 days: Bull run ahead?
What's the story
The Indian stock market has witnessed a major rally this week, with the benchmark indices Sensex and Nifty surging over 2,700 points and 3.5%, respectively. The rally comes despite ongoing global uncertainties such as the US-Iran war and rising crude oil prices. Analysts are now debating whether this upward momentum will continue or if a market correction is on the cards.
Investment advice
Large caps better placed from risk-reward perspective
As the markets inch closer to all-time highs, analysts are offering investment strategies. Tata Mutual Fund's report said, "Moderating valuations, now close to long-term averages, along with an expected earnings growth recovery of 15-17% in FY27, are setting a constructive outlook for equity markets despite ongoing global uncertainties." The report also noted that large caps are better placed from a risk-reward perspective due to relatively attractive valuations and earnings stability.
Market outlook
Axis Securities on Nifty outlook
Axis Securities noted that Nifty could show a directional move in the 24,000-24,150 zone. The index has formed a spinning top candle, indicating indecisiveness as markets await the US Fed's FOMC policy decision. Despite this pause, traders are looking for direction from global cues with 24,000-24,150 acting as strong resistance area and 23,000-22,900 range remaining a crucial support band that bulls need to defend to maintain stability in the market.
Investor sentiment
HDFC Securities on foreign investors' short positions
Devarsh Vakil, Head of Prime Research at HDFC Securities, expects markets to gain momentum as foreign investors begin unwinding their short positions in index futures. He said, "We expect markets to gain momentum as foreign investors begin unwinding their short positions in index futures." This comes amid ongoing global uncertainties such as the US-Iran war and rising crude oil prices.
Market strategy
Choice Equity on stock-specific approach
Aakash Shah, Technical Research Analyst at Choice Equity Broking Private Limited, advised a stock-specific approach with disciplined risk management as indices near key resistance levels. He said, "Traders may continue to focus on banking, financials, and capital goods stocks, which are showing relative strength." This comes amid ongoing global uncertainties such as the US-Iran war and rising crude oil prices.