Investors' wealth soars ₹28.65 lakh crore in three days of market recovery after rout

• Investors' wealth has soared by ₹28.65 lakh crore in the three-day rally to Friday in the stock markets.
• The three days saw benchmark Sensex recouping 4,614.31 points or 6.40% to close at a record high.
• On Friday, the 30-share BSE Sensex jumped 1,720.8 points or 2.29% to hit a new record peak of 76,795.31 in day trade.

Investors' wealth has soared by ₹28.65 lakh crore in the three-day rally to Friday in the stock markets, which saw benchmark Sensex recouping 4,614.31 points or 6.40 per cent to close at a record high. The sharp rebound in stock markets follows Tuesday's mayhem which wiped out over ₹31 lakh crore of investors' wealth in a single day as markets crashed after poll results lagged its expectations.

On Friday, the 30-share BSE Sensex jumped 1,720.8 points or 2.29 per cent to hit a new record peak of 76,795.31 in day trade. The benchmark ended at 76,693.36, up 1,618.85 points or 2.16 per cent.

The NSE Nifty settled with a jump of 468.75 points or 2.05 per cent at 23,290.15.

Following the remarkable recovery in equities, the market capitalisation of BSE-listed companies went up by ₹28,65,742.36 crore to ₹4,23,49,447.63 crore (USD 5.08 trillion) in three days.

"Domestic markets shrugged off weak global cues, as investors cheered the RBI's higher growth forecast for FY25 in its credit policy announcement which propelled Sensex to a fresh all-time high above the 76k-mark on massive broad-based buying support.

"Also, the arrival of monsoon rains on time and expectations of its even spread across the country raised hopes of softening inflation going ahead. With the election uncertainty now over and the NDA party most likely to form the government, investors are hopeful that the action will now shift to reforms and the upcoming Union Budget," Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd, said.

The Reserve Bank of India (RBI) left its key interest rates unchanged on Friday as expected, keeping the focus on inflation amid robust economic growth that is likely to provide the new Modi government headroom for manoeuvring reforms.

The Monetary Policy Committee, consisting of three RBI and an equal number of external members, kept the repo rate unchanged at 6.50 per cent for an eighth straight policy meeting and stuck to its relatively hawkish stance of "withdrawal of accommodation", Governor Shaktikanta Das said in his statement.

With the Indian economy, Asia's third-largest, growing faster than expected in the previous year, the RBI raised its GDP growth projection for the current fiscal through March 2025 to 7.2 per cent from 7 per cent while maintaining its inflation forecast at 4.5 per cent.

All the 30 Sensex companies ended in the positive territory on Friday, with Mahindra & Mahindra, Wipro, Tech Mahindra, Bharti Airtel, Infosys and Tata Steel emerging as the biggest gainers.

"This week, the market experienced extreme volatility, with investor emotions on a roller-coaster ride. The RBI's decision to keep the repo rate unchanged at 6.5 per cent, along with an upward revision in the growth rate to 7.2 per cent from 7 per cent, boosted market sentiment. This indicates solid performance for the domestic economy," Vikram Kasat, Head of Advisory of Prabhudas Lilladher Pvt Ltd, said.

In the broader market, the BSE smallcap gauge climbed 2.18 per cent and midcap index rallied 1.28 per cent.

All indices ended in the positive territory. Telecommunication jumped 3.78 per cent, IT soared 3.38 per cent, teck (3.33 per cent), auto (2.53 per cent), utilities (2.18 per cent), metal (2.15 per cent), energy (1.99 per cent) and consumer discretionary (1.94 per cent).

As many as 2,890 stocks advanced while 970 declined and 92 remained unchanged on the BSE.

"The anticipation of stability within the coalition government at the centre, coupled with the RBI's upward revision of its growth forecast for FY25 to 7.2 per cent, fuelled a broad-based rally in the domestic market. The Indian market surpassed its previous record high set on exit-poll day and reached a fresh peak," Vinod Nair, Head of Research at Geojit Financial Services, said.

In an eventful week, the BSE benchmark Sensex jumped 2,732.05 points or 3.69 per cent and the Nifty zoomed 759.45 points or 3.37 per cent.

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