The S&P BSE Sensex index skyrocketed 14 per cent in April, posting its best monthly return in 11 years, as the equity markets tracked gains in global peers on optimism about a COVID-19 drug to treat the pandemic that has pushed world business into a standstill. Hopes of fiscal stimulus to stem the impact of COVID-19 lockdown on the economy also fuelled the rally in domestic stock markets, say analysts.
The Sensex ended 997 points or 3.05 per cent higher at 33,718 and Nifty 50 index surged 307 points or 3.21 per cent to settle at 9,860.
Analysts say more correction cannot be ruled out as investors assess the economic fallout from the coronavirus outbreak amid rising number of cases.
“Whenever you see a deep correction, there is a bounce. I feel after next two-three days correction might start again and we are advising clients to take money off the table. Economy is still not open and we cannot ascertain the impact COVID-19 had on the economy. Nifty can go below 7,500 as well,” AK Prabhakar, head of research at IDBI Capital, told NDTV.
"Dark clouds are not over yet for the markets. The rally should have had logic and legs and markets does its excesses either on downside and upside. Some correction cannot be ruled out down the line and that will be a good time to buy fundamentally sound stock in FMCG and pharma space," said market expert Vijay Chopra of Enoch Ventures.
The markets will remain closed on Friday for Maharashtra Day.