Positive global cues, RBI rate cut hopes, and technical support levels drive the stock market to new heights.
February 4, 2025: On February 4, the Indian stock market witnessed a remarkable rally as the Sensex surged over 1,400 points, and the Nifty 50 crossed the 23,750 mark during intraday trading. The BSE Midcap and Smallcap indices also registered gains of 1% each, adding to the day’s broad-based market momentum.
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The Sensex opened at 77,687.60 and closed at 78,583.81, recording a rise of 1,397 points (1.81%). The Nifty 50, meanwhile, gained 378 points (1.62%) to end at 23,739.25. The market capitalization of BSE-listed firms increased by ₹5.5 lakh crore, taking the total to ₹425 lakh crore.
Key Factors Driving the Rally:
Experts have identified the following five reasons for the market’s upward trajectory:
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- Global Cues Boost Investor Sentiment
Major Asian markets, including Japan’s Nikkei, Korea’s Kospi, and Hong Kong’s Hang Seng, saw gains of over 1%, thanks to changes in US trade policies that lifted global sentiment. - Trump Administration Pauses Tariffs on Mexico and Canada
US President Donald Trump’s decision to temporarily halt tariffs on Mexico and Canada has provided much-needed relief to markets, encouraging a positive outlook. - RBI Monetary Policy Expectations
The Reserve Bank of India’s Monetary Policy Committee (MPC) is expected to announce a 25 basis points rate cut this week. Market participants are optimistic about measures to inject liquidity and ease monetary conditions further. - Attractive Valuations in Large-Cap Stocks
The Nifty 50’s 11% decline from its peak has created valuation comfort, making select large-cap stocks attractive to investors. Analysts at Motilal Oswal Financial Services noted that the index’s 12-month forward PE ratio is now trading below its historical average, offering opportunities for value investors. - Technical Indicators Signal Support Levels
The Nifty 50 has key support at the 23,200 level, which analysts believe will hold the market momentum. Resistance is pegged at 23,800, indicating a potential breakout.
Broader Market Highlights:
- The BSE Midcap index rose by 1.35%, while the Smallcap index gained 1.20%.
- The overall market sentiment remains bullish, supported by a mix of domestic and global factors.
- Analysts caution that while current indicators are favorable, short-term volatility may persist.
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Sensex surge, Nifty 50 gains, stock market rally, global market impact, RBI rate cut expectations, market capitalization growth, Indian economy, stock market analysis.