Indian stock indices extends gains on firm overseas cues

On Wednesday morning, Indian market indices performed favorably, following strong cues from international counterparts and signs that the US may avoid a recession. As of the time this post was being written, both the Sensex and the Nifty were up 0.2-0.3%. “In tune with the International Yoga Day, the market is slowly stretching both ways, without any sharp up or down moves. However, the broad market trend is up,” said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services. “Globally markets are bullish even when global growth is sluggish. The reason for this bullish trend is that the US recession, which markets had discounted last year, didn’t happen and there are indications that the US might avoid a recession. So, markets are correcting the wrong discounting of last year,” Vijayakumar added. Strong fundamentals favorably affect the markets, including a solid GDP projection, modest inflation, and robust purchases by foreign investors. Nearing record highs are the domestic stock indices.
However, the financial markets are still concerned about how slowly the southwest monsoon is developing. In the meantime, Prime Minister Narendra Modi’s visit to the US and potential defence cooperation between the two nations have refocused attention on India’s stockpiles of weapons.
Due to the government’s aggressive drive for domestic manufacture, defence stocks have performed pretty well in recent years; in fact, many of them have become multi-baggers.