Mumbai: Stock benchmarks surged on March 18, as the Sensex reclaimed the 75,000 mark with impressive gains, driven by positive global cues and strong domestic economic indicators. The 30-share BSE Sensex soared 901.43 points, or 1.21%, reaching 75,071.38, marking its return to this significant milestone. Meanwhile, the NSE Nifty similarly climbed, gaining 265.9 points to hit 22,774.65, continuing its positive momentum from the previous session.
This rally is attributed not only to market recovery after recent declines but also to the resurgence of investor confidence spurred by firm global equity signals. The Dow Jones, for example, rose by 353.44 points (0.85%), with the S&P 500 and Nasdaq also posting gains, thereby gladdening local market sentiment.
Investors seized the opportunity for valuation buying, encouraged by the conclusion of last week’s trading sessions where the Nifty Bank index reached over 49,000.
Positive macroeconomic indicators also laid the groundwork for today’s gains. India’s GDP is projected to grow by 6.2% for the quarter ending March 31, FY25, alongside a significant 5.1% increase in the industrial production index (IIP). Tax collections have observed a remarkable 16% boost, and retail inflation has eased to 3.6%, offering more assurance to investors.
The rupee showed resilience also, appreciating by 10% to 86.71 against the US dollar during early trading, which had swung back positively after showing signs of slight vulnerability last week.
Among the notable gainers on the Sensex today were eminent stocks such as ICICI Bank, Zomato, Mahindra & Mahindra, Tata Motors, and Hindustan Unilever, which contributed significantly to the index’s uplift. Reflecting broader market health, smallcap indices gained 2%, reasserting some optimism among smaller investors.
Despite these significant surges, there’s caution among analysts about the market's sustainability of this upward trend. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, indicated, “The market may have bottomed out, though intermittent corrections cannot be ruled out.” He cited the combined positive domestic factors like GDP growth and easing CPI inflation, but also warned about global risks, particularly concerning tariff wars which could hinder potential growth.
On the investment front, data revealed Foreign Institutional Investors (FIIs) continued to sell off equities, contributing to outflows of Rs 4,488.45 crore on March 17, though Domestic Institutional Investors (DIIs) countered with purchases worth Rs 6,000.60 crore. Meanwhile, the crude oil market showed upward momentum with Brent crude prices rising by 0.32% to $71.33 per barrel, which may affect inflation moving forward.
A noteworthy development came from Bajaj Finserv, whose shares dipped 2% after announcing plans to acquire a 26% stake from Allianz SE for approximately Rs 24,180 crore ($2.83 billion). This deal signals Bajaj's intent to consolidate control over its insurance ventures, marking the end of nearly 25 years of partnership with Allianz.
Adding to the market’s buzz were Tata Motors, whose share prices rose over 2% following its announcement to increase prices on commercial vehicles by up to 2% starting April 1, 2025, aimed at counteracting rising input costs. Global brokerage firm HSBC also upgraded Tata Motors’ stock rating to ‘Buy’, setting the target price at Rs 840 per share, indicative of a possible 29% upside.
Investments poured back, particularly with sugar stocks rallying on March 18, catalyzed by sugar futures reaching their highest levels in almost three weeks due to worries over supply shortages. Stocks belonging to leading sugar manufacturers saw substantial gains of up to 20%.
With volatility still lurking just beyond the immediate horizon, analysts believe the market will likely remain range-bound without significant breakouts or breakdowns, as global investor sentiment remains cautious entering the anticipated Federal Reserve meeting, which is set to convene on March 18 and 19. Investors are awaiting the Fed’s decision on whether to maintain current interest rates of 4.25% to 4.5% alongside updated economic projections.
Emphasizing potential trading strategies, Axis Securities noted, “The trend-deciding level for the day is 22,480. If Nifty trades above this level, it may rally up to the 22,600 or even higher. Analytical estimates show resistance at 22,830.” Market participants continue to watch closely for key indicators to guide their investment decisions.
While optimism is bulging through the floors of Dalal Street, the ever-changing tides of the economic environment, both domestic and international, will likely dictate sentiment toward the equities moving forward. Today’s hefty gains signal significant buying enthusiasm, but investors are advised to stay alert and prepared for potential reversals as trends solidify.
