Benchmark stock market indices opened higher on Wednesday as investor sentiment lifted over hopes of talks resuming between Iran and the US.
The S&P BSE Sensex was up 1,189.51 points to 78,037.08, while the NSE Nifty50 rose 366.40 points to 24,209.05 as of 9:26 am.
Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said that hopes of resumption of US-Iran talks, Israel-Lebanon talks and crash in Brent crude by $10 dollars in two days augur well for the market in the near-term.
“The resilience of markets worldwide, despite the IMF’s warning about a global recession if the conflict prolongs, is an indication that the market is discounting an end to the conflict soon,” he added.
In the extremely volatile scenario through which markets have been moving, it is important that investors remain invested. The benefit from sharp rebounds in the market will be lost to investors who sell out and keep away from the market.
In the near-term large caps are likely to stage a smart comeback, but may again face headwinds when FIIs resume selling. The excellent performance of South Korean and Taiwanese markets and the significant market momentum there might nudge FPIs to sell again in India.
Sustained resilience in the near-term is likely to be in mid and small caps which will not come under the pressure of FPI selling.
