Share Market Recovers: Indian stock markets witnessed sharp fluctuations today on January 12. Both Sensex and Nifty fell as soon as the markets opened, but suddenly the picture changed completely in the afternoon. The Sensex returned to the green with a strong jump of nearly 700 points from the day’s low. Nifty also bounced from below 25,500 and returned strongly to the green mark. Increased expectations regarding the India-US trade deal and value buying are being considered as the two major reasons behind this sudden comeback of the stock market.
Earlier in early trade, the Sensex had fallen 715.17 points or 0.85% to an intraday low of 82,861.07 due to weak global cues and continuous selling by foreign investors. At the same time, Nifty also slipped to 25,473.40 and went below the important level of 25,500.
However, after this the market environment suddenly changed and both the major indices registered a sharp recovery. Both Sensex and Nifty recovered their entire fall and came into the green with slight gains. There were two big reasons behind this recovery.
1. Confidence increased due to India-US trade talks
The biggest reason behind the rise in the stock market was the statement of US Ambassador to India Sergio Gore. Sergio Gore said that both the countries are actively negotiating a trade deal and the next talks on this are going to happen soon. “Both sides continue to actively negotiate trade and the next major meeting is scheduled for tomorrow,” Gore said. His statement raised hopes among investors that good news may come soon on the India-US trade deal. After this, buying was seen again in the stock market.
Apart from this, Gore also indicated that US President Donald Trump may visit India in the next one to two years, which further strengthened the market sentiment regarding relations between the two countries. After these statements, the Sensex was seen recovering by more than 600 points from the day’s low and trading around 83,454.62, while the Nifty also recovered and reached near 25,670.20.
2. Value buying after continuous decline
The second important reason behind the strength of the stock market was value buying at lower levels. Last week, the stock market had seen a decline for five consecutive days. During this period, investors remained cautious due to continuous selling by foreign investors, possible US tariffs on Indian goods and concerns related to global geopolitics.
On Monday, when the market reached attractive valuations after the initial fall, many investors considered it a buying opportunity. Buying, especially in select blue-chip and heavyweight stocks, supported the market and the benchmark indices recovered rapidly.
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