The Indian stock market made a strong comeback on Tuesday after suffering a continuous decline for three days. Foreign investors may have been standing away from the past weeks, but the strong performance of domestic legendary companies gave speed to the market. The Sensex climbed 446 points to close at 81,337, while the Nifty also rose to 24,821 with a rise of 140 points.
Reliance, HDFC and L&T give strength to the market
Reliance Industries, HDFC Bank and L&T became the real reason for this fast. Reliance shares recorded 2.13%, HDFC Bank 1.3% and L&T 2.15%. The weight of these companies is quite high in the Sensex and Nifty, so when these stocks go up, the entire market runs together. According to experts, the participation of foreign investors on Tuesday remained modest, but still the market move was strong and the credit goes to the same big companies whose free float market cap is the highest.
24,800 levels become strong support for Nifty
Technical analyst Hardik Metalia says that Nifty has given closing above 24,800 on Tuesday after getting support from her 100 -day EMA. He said, “The market was seen to be seen at the lower level and made a bullish candle with strong volumes. If this level remains intact, it is possible to up to 25,000 and 25,200.” There is 24,600 first support at the bottom, in which up to 24,200 corrections can be seen.
Reliance, L&T and Asian Paints in Top Gainers
The biggest jump in the Nifty 50 pack was made by Jio Financial Services, which climbed 4.5%. Apart from this, stocks like L&T, Reliance, Asian Paints, and Eicher Motors also performed vigorously.
Top gainers
- Geo Financial: +4.5%
- L&T: +2.15%
- Reliance Industries: +2.13%
- Asian Paints: +1.78%
- Eicher Motors: +1.57%
Why does the weight of big companies matter?
Both the major index Sensex and Nifty of the market are actually based on the performance of the country’s largest and most trades. There are 30 companies in Sensex and 50 in Nifty. These include veterans like Reliance, TCS, HDFC Bank, Infosys. Their weightage is fixed on the basis of their free float market cap i.e. public share. This means that if Reliance alone climbs 2%, then it shows a lot of effect in the Sensex and Nifty. The same happened on Tuesday when foreign investors looked weak but domestic heavyweight companies supported the market.
What are the stock market signs saying?
Despite the recent boom, the market is not completely confident. There is still pressure in the IT and metal sector. But there are signs of improvement in auto, FMCG and energy sector. Investors are being advised to shop on the decline, especially in the stocks whose fundamental is strong.
Who is the real engine of the stock market?
Foreign funds may keep coming and going, but the market gets real strength when big companies of the country perform reliable. When Reliance, HDFC Bank, L&T and other bluechip companies hold pace together, the market does not take long to become a rocket. This is the real strength of big companies.