Sensex jumps 494 points, m-cap tops Rs 400 lakh crore; Nifty settles at 22,666: Key reasons behind today's rise

Indian equity benchmarks scaled their fresh lifetime peaks in Monday's trade. The 30-share BSE Sensex pack jumped over 600 points to hit a record high of 74,869. It eventually settled 494 points or 0.67 per cent higher at 74,742. The broader NSE Nifty index moved more than 180 points to touch 22,697 level for the first time ever. The pack finally closed 153 points or 0.68 per cent up at 22,666.

Such was the rise in the domestic bourses that more than Rs 1.5 lakh crore of BSE market capitalisation (m-cap) was generated. Investor wealth, as suggested by the BSE m-cap, rose Rs 1.54 lakh crore to Rs 400.86 lakh crore compared with a valuation of Rs 399.31 lakh crore recorded in the previous session.

Here are the key reasons behind the stock market rise:

Pre-election rally

Investor sentiments were up ahead of 2024 general elections. A rally in stock market is not unusual in the run-up to elections. "Prime Minister Narendra Modi's BJP is widely expected to remain in power. Modi remains popular amongst the vast majority of Indians, and the opposition alliance hasn't proven to be a credible threat, rife with infighting and defections," said Haitong International in a note.

Auto, energy & realty stocks surge

10 out of the 15 sector gauges -- compiled by the NSE -- were trading in the green. Sub-indexes Nifty Auto, Nifty Oil & Gas and Nifty Realty outperformed the NSE platform by rising as much as 1.81 per cent, 1.07 per cent and 1.70 per cent, respectively.

FII-DII data

Foreign institutional investors (FIIs) bought Indian shares worth Rs 1,659.27 crore on a net basis during the previous session while domestic institutional investors (DIIs) sold shares worth Rs 3,370.42 crore.

Risk factor

Easing expectations of a US rate cut in June could weigh on sentiment. Asian markets were subdued after another blowout US jobs report dampened expectations of a Federal Reserve rate cut in June.