Sensex Jumps Over 850 Points as Investor Wealth Rises ₹7 Lakh Crore

On January 22, Thursday, the Sensex surged more than 850 points (over 1%), reaching an intraday high of 82783. The Nifty 50 index rose by more than 1% to reclaim 25435. The BSE Midcap and Smallcap indices gained nearly 2% each, resulting in an increase of BSE-listed company market capitalisation of ₹7 lakh crore to approximately ₹461 lakh crore.

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

Broad-based sector growth was propelled by positive global news and U.S. President Donald Trump's less aggressive position toward Greenland following the official announcement of BSE-listed company market capitalisation by ₹7 lakh crore to approximately ₹461 lakh crore.

Five key reasons for today's market climb include:

U.S.-EU Trade War Fears Ease

After backing off from a previous threat to impose tariffs on Europe regarding Greenland, Trump provided more clarity regarding his and NATO Secretary General Mark Rutte's plans for the island.

The improved outlook for an escalation of the U.S.-Europe Trade War provided much-needed relief to the market.

India-U.S. Trade Deal Hopes Rise

As positive comments about Indian Prime Minister Narendra Modi from Trump have led to increased faith in bilateral relations between the two countries, it becomes apparent that there are active discussions toward reaching a trade agreement.

Additionally, the reduction of geopolitical risks serves to increase the attractiveness of risk assets.

Short Covering Follows Selloff

Last week's rally was spurred on by some short covering stemming from global tension relief, and this is further backed by strong macroeconomic positions in India.

Q3 Earnings In Line with Views

The third-quarter results were in line with many analysts' expectations. Although there were some one-off impacts from new labour code rules this quarter, the majority of the earnings numbers showed low surprise and good health.

The results from Eternal (the delivery start-up company) were impressive in both revenue generated and profit after return, as well as strong numbers from banks and IT. Additionally, consumer companies (e.g., auto and NBFCs) will likely achieve an average growth rate over the next 8-10 quarters of around 8-10% per quarter.

Technical Support Sparks Bounce

The Nifty at 25,000 (the level where market support was confirmed) is now providing a significant platform for recovery as we look to the upcoming budget and recovery trends.