Mumbai. In today’s trade, Sensex and Nifty set new highs of 52,626.64 and 15,835.55. The market also seems to be getting support from good global cues. In today’s business, along with the giants, small and medium stocks are also seen jumping. Today BSE Small and Midcap index has also touched the level of 23,045.01 and 25,248.88.
This year the Indian market is the world’s top performer
This year the Indian market has been among the top performers in the world. So far in 2021, the Sensex has seen a jump of 10 percent and the Nifty has seen a jump of 13 percent. The market capitalization of companies listed on BSE has exceeded Rs 231 lakh crore.
The market may rise furtherSpeaking on the market, VK Vijay Kumar of Geojit Financial Services said that the US 10-year bond yield has come down to around 1.44 per cent while the dollar index is circling around 90 which is an indication that the market is yet to move. May accelerate. But the strong growth that has come so far in the mid and smallcap space is now giving some concern.
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He further said that in 2017 the smallcap index had seen a rise of 60 per cent but in 2018 all this foam was cleared. Due to which the investors who entered the smallcap index in 2018 had to suffer.
He further said that leading financial, IT, pharma and metal stocks are looking strong. Stay invested in these stocks but be careful while investing in smallcap stocks.
Important factors driving the market
1. There is a steady decline in the cases of Kovid-19 in India. For the fourth consecutive day on June 11, less than 1 lakh cases have come. During the last 24 hours, 91,702 new cases of coronavirus infection have been reported in the country. With this, the total number of infected has increased to 2,92,74,823. In this, the active cases are 11,21,671 while 2,77,90,073 people have been cured of this infection. Whereas in the last one day, 1,34,580 people have recovered and returned home.
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2. There is a softening in the lockdown in all the states of the country, due to which the market sentiment is getting a boost. With the progress of Unlock, there may be an improvement in the demand in the country, which will give a boost to the market. Since this year the lockdown was not imposed in the entire country simultaneously, so its effect is also less than in 2020.
Market leaders say that going forward we will see sectors like hospitality, travel, and entertainment getting the benefit of pent-up demand.
3. There is a rush of retail investors in the Indian equity market. By June 7, 2021, 70 million users had been registered in the country’s leading exchange BSE, which is a paradigm in itself. Some analysts believe that the boom in the market is being seen due to the increasing number of retail investors.
Deepak Jasani of HDFC Securities says that the increasing number of retail investors in the market after Kovid-19 is an important reason for the market rally. Jasani also says that due to the increasing number of retail investors, there will be less dependence of the market on institutional investors going forward.
He further said that this will accelerate the expansion of equity culture in the country. However, in the event of a steep fall, many serite investors may get stuck at higher levels and walk away from the market for some time.
4. Apart from this, enthusiasm is also coming from the expectation of fast economy growth in the market. There is an expectation in the market that once the Kovid-19 is under control, the economy will grow rapidly. Due to this expectation, the market is also jumping.
5. The general belief is that the only and most effective way to deal with the corona pandemic is through vaccination. With the pace of vaccination accelerating, the market is also getting excited. Apart from this, the market is also getting support from the indication of no change in rates by RBI.
But we also have to keep in mind that there is some risk in the market. There remains concern about the third wave of Kovid-19. Rising inflation can spoil the color. Economic indicators are also showing signs of pressure and the market is showing an opposite trend towards the economic condition. This means that on one side the economy is under pressure, while on the other hand the market is swinging, this is a big contradiction in itself.