Stock Market Today: Nifty opens at record highs, cheers a likely PM Modi third term
- India’s Nifty rebounded to open at record highs on Monday.
- Exit polls point to a stronger return for the PM Modi-led BJP government.
- All eyes remain on the June 4 India’s general election outcome.
Nifty 50, India’s key benchmark index, firmed up to hit a new record high above 23,300 at the open on Monday, snapping the previous week’s 2% decline.
Nifty recorded its biggest jump in four years during the market opening.
A potential win, with a majority, for the Bharatiya Janata Party (BJP)-led Prime Minister Narendra Modi’s government ramped up optimism in the Indian stock market.
The National Stock Exchange (NSE) Nifty 50 is up 2.62% on the day, trading near 23,120, as of writing.
Stock market news
- Early gainers on Nifty are Adani Ports, Adani Enterprises, Powergrid, NTPC and Shriram Finance. Meanwhile, the main laggards in early dealings are Eicher Motors and LTiMindtree.
- Exit polls over the weekend predicted that PM Modi will retain power for a third straight term, with BJP-led NDA winning anywhere between 350-401 seats.
- The Indian rupee opened 47 paise higher, which was a near three-month high for the currency.
- Markets also cheer upbeat Chinese Caixin Manufacturing PMI, which improved from 51.4 in April to 51.7 in May, beating the estimates of 51.5.
- Last week, India’s economy grew by 8.2% in the fiscal year ended March 2024, sharply higher than 7% expansion recorded in the previous year, led by a robust performance of manufacturing and construction sectors, per Reuters.
- All eyes remain on the results of the 2024 India’s general election due on Tuesday and the Reserve Bank of India’s (RBI) monetary policy announcements on June 7 for fresh trading impulse.
Nifty 50 FAQs
The Nifty 50, or simply Nifty, is the most commonly followed stock index in India. It was launched in 1996 by the National Stock Exchange of India (NSE). It plots the weighted average share price of 50 of the largest Indian corporations, offering investors comprehensive exposure to 13 sectors of the economy. Each corporation's weighting is based on its "free-float capitalization", or the value of all its shares readily available for trading.
The Nifty is a composite so its value is dependent on the performance of the companies that make up the index, as revealed in their quarterly and annual results. Another factor is government policies, such as when in 2016 the government decided to demonetize 500 and 1000 Rupee banknotes. This led to a temporary cash shortage which negatively impacted the Nifty. The level of interest rates set by the Reserve Bank of India is a further factor as it determines the cost of borrowing. Climate change, pandemics and natural disasters are also drivers.
The Nifty 50 was launched on April 22, 1996 at a base level of 1,000. Its highest recorded level to date is 22,097 achieved on January 15, 2024 (this is being written in Feb 2024). The index first closed above the 10,000 level on October 17, 2017. The Nifty recorded its biggest daily decline on March 23, 2020 during the Covid pandemic, when it fell 1,125 points or 12.37%. The Nifty’s biggest gain in a single day occurred on May 18, 2009, when it rose 651 points after the results of the Indian elections.
Major corporations in the Nifty 50 include HDFC Bank, Reliance Industries, ICICI Bank, Tata Consultancy Services, Larsen and Toubro, ITC Ltd, Housing Development Finance Corporation Ltd and Kotak Mahendra Bank.
Recommended Articles
