October Low Sparks Impressive 10% Rally in Nifty

Siddhartha Khemka, Head of Retail Research at Motilal Oswal Financial Services, reports a remarkable 10% surge in Nifty, climbing 1,865 points from its October low of 18,837. The bullish trend was fueled by BJP’s victory in three states, propelling Indian equities to a new high of 20,702 on Monday.

Nifty displayed a strong one-sided movement, opening with a gap up and closing with a 419-point gain (+2%) at 20,689 levels, according to Khemka. All sectors, except pharma, ended positively, with oil & gas, banking, and financials leading the gains at 3% each. Government-related sectors like infra, capital goods, power, railways, defense, and PSU stocks showed momentum.

The market momentum was further bolstered by BJP’s electoral success, robust macroeconomic data, and global interest rate expectations, Khemka noted. Rupak De, Senior Technical Analyst at LKP Securities, attributed Nifty’s gap-up start to BJP’s exceptional performance. Technically, Nifty surpassed the critical resistance level of 19,850, with a shift in Put positions indicating optimism for a strong upward rally. The sentiment remains highly bullish unless Nifty drops below 20,400, and the index might move towards 21,000 on the higher end