5 Reasons Why Sensex Surged 617 Points Today

FII Inflows: Foreign portfolio investors (FPIs) remained net buyers to the tune of Rs 122.7 billion in Indian share markets in the first five trading sessions of February, as positive sentiment after the Union Budget 2021 sparked a rally.

Q3FY21 Earnings: So far, India Inc's earnings reports have beaten analysts' expectations, improving investor sentiments.

Sectoral Indices End in Green: Barring FMCG stocks, all sectoral indices ended in the green. The BSE metal index and the BSE auto index surged over 3%.

We will keep you updated on how these factors develop in the coming days and what effect they have on Indian stock markets. Stay tuned!

Speaking of the current stock market scenario, note that since the lows in March 2020, the smallcap index has gained more than 100%.

Have a look at the history of previous smallcap crashes and rebounds over the last two decades...

As you can see, every big fall in the smallcap index was followed by a sharp up move, a minimum gain of 200%. Twice the rebounds were just shy of touching 300%.

Richa believes if you focus on the quality of business, margin of safety in valuations, and an optimum asset allocation, you are likely to create huge wealth for yourself.

In news from the financial markets space, the Reserve Bank of India (RBI) will aim to purchase up to Rs 200 billion worth of government bonds via open market operations on Wednesday, the central bank said in a release today.

The above move pulled yields down by five basis points with the benchmark gauge trading at 6.03%.

Four sets of sovereign papers are included in the proposed purchase plan with residual maturities ranging from 4 to 14 years.

The RBI has so far bought about Rs 2.5 trillion of net debt in the current financial year. The figure will be as high as Rs 3 trillion by end-March as authorities are keen to shrink the spread between the 10-year bond yield and repo rate to around 150 basis points from more than 200 basis points.

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Disclosure: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research ...

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