Nifty at 8-month high on likely delay in US’ EU tariffs

Stock market rallied 1.2% to an eight-month high on the third consecutive positive day responding to relief from potential delay in U.S. tariff on European Union. 

Nifty and Sensex closed at 25,549.00 and 83,755.87 points respectively on the June 26.

Barring Media, telecom and realty indices, all sectoral indices were up on the bourses. Metal Indices were up the most increasing 2.13% and Oil and Gas stocks rallied 1.6%.

On this monthly expiry day, trading volumes on the NSE cash market were higher by 17% compared to yesterday, indicating increased participation, experts said. 

Indian bourses majorly reacted to economic policy decisions in US which affected the dollar index. 

“The Indian Rupee also reflected the market’s bullish sentiment, appreciating by 38 paise against the U.S. dollar to close at 85.70, its highest close since June 12th. This rise in the rupee was primarily driven by a weaker US Dollar Index, which has plummeted to a three-year low amidst growing speculation that US President Donald Trump is considering nominating the next Federal Reserve chair early, potentially paving the way for a more dovish monetary policy,” according to Nandish Shah, Senior Derivative & Technical Research Analyst, HDFC Securities.

“Nifty has emphatically surpassed its crucial swing high resistance of 25,317 and closed well above it,” Mr.Shah said. Swing high refers to a situation when the chart’s peak is followed by two smaller peaks. This signifies a potential resistance level for the market. “Nifty is now expected to head towards the next resistance band of 25,640-25,740, where an unfilled gap lies on the daily charts. On the downside, the previous resistance of 25,317 is now expected to interchange its role as a strong support going forward, reinforcing the bullish structure of the market,” Mr.Shah added.