Sensex surges 2,303 point, recoups nearly half of results day’s losses

MUMBAI: Volatility on Dalal Street remained elevated on Wednesday as investors remained cautious before a new govt was formed on the back of a less-than-expected tally for the ruling NDA. The sensex moved from marginal negative mark in early trades to up over 1,500 points by mid-session. And after allies in NDA confirmed their participation in the BJP-led govt, the index finally settled 2,303 points up at 74,382 points.Nifty closed 736 points higher at 22,620 points.
It was one of the rare days when all 30 sensex stocks closed with gains. While a 7.8% gain in IndusInd Bank was the highest among sensex stocks, a marginal 0.2% gain in L&T was the lowest, BSE data showed. The day’s rally added about Rs 13 lakh crore to investors’ wealth with BSE’s market capitalisation now at Rs 414 lakh crore. On Tuesday, investors had seen record Rs 31-lakh-crore wipeout in market capitalisation.
The day’s gains came on the back of strong buying by domestic funds while foreign portfolio investors remained net sellers. Domestic funds were net buyers at Rs 4,555 crore compared to a Rs 5,656-crore net selling by FPIs, BSE data showed.
Compared to Tuesday’s wild swing, volatility during the day’s session was lower. After scaling a multi-year high at 26.9 points in early trades, India VIX, also known as the fear gauge, closed at 18.9, its lowest closing mark since May 10, NSE data showed.
Brokers and fund managers believe with the new govt formation almost certain by this weekend, the market would now stabilise.

Investors will now keenly watch the economic policy of the govt such as the Budget, and its 100-day plan, Ashish Gupta, CIO, Axis Mutual Fund, said. “I believe India has all the right ingredients in place to set the growth momentum further,” he said. Gupta expects the focus to be back on companies and their earnings potential, something that has been one of the major drivers of India’s long-term growth story.
In Wednesday’s session, telecom, metal and FMCG led the rally. While BSE’s telecom index closed 6% higher, the metal index closed 5.4% up and the FMCG index closed with a 4.5% gain. “Expectation of a healthy monsoon is driving buying interest in FMCG and auto stocks,” said Siddhartha Khemka, head (retail research), Motilal Oswal Financial Services. “Going ahead, the narrative around govt formation and RBI’s monetary policy would take the centre stage.”
The NSE on Wednesday handled 1,971 crore stock trading orders, the highest ever number of transactions in a single day anywhere in the world, Ashish Chauhan, MD & CEO of the bourse, said on X.