Making auspicious purchases during Diwali is a deep-rooted cultural tradition across India, believed to usher in wealth and long-term prosperity. Carrying forward this sentiment, domestic bourses conduct a special one-hour Muhurat trading session even on an official trading holiday. This brief window marks the traditional transition into the new Hindu accounting year known as Samvat. Historical data demonstrates that this ritual is not merely ceremonial; it has consistently delivered tangible financial gains to market participants who step in to buy equities on this auspicious evening.
Green Closes Dominate 12 Out of Past 15 Sessions
An examination of trading history over the past 15 years indicates that the bourses settled in positive territory on 12 distinct occasions, rewarding participants with solid opening gains. Only three times did the benchmark indices end up in the red on Diwali day. The session in 2022 stood out as the most memorable performance, during which both the Sensex and Nifty rallied by 0.88%. Conversely, the sharpest disappointment arrived in 2017, when broad-based profit booking dragged the Nifty down by 0.63% and the Sensex lower by 0.59%.
Sensex and Nifty Multiplied Fivefold Across Decades
In October 2011, the Sensex stood at a modest level of 17,288 during the Diwali session. By the previous year, the benchmark barometer soared to 84,426 points, representing an impressive fivefold multiplication of capital over this multi-year timeline. In tandem, the Nifty surged from 5,201 to climb well past the 25,868 milestone. This wealth generation materialized despite severe macro headwinds, with domestic equities navigating multiple systemic shocks such as global recessions, the COVID-19 pandemic, elevated inflation spikes, and the geopolitical fallout from the war in Ukraine.
Current Index Levels and the Dhanteras Rebound
Heading into the evening session, the indices still trade slightly below their levels from the previous year's festive gathering. The Nifty remains approximately 3% lower than that benchmark, while the Sensex sits nearly 4% below its prior year level. Nevertheless, sentiment received a major boost on Dhanteras, when the Nifty jumped 2.01% to finish at 25,030.35 and the Sensex added 2.17% to settle at 81,028.02. Backed by a rebound exceeding 10% across the last seven trading days, market participants are anticipating that this evening session will honor historical precedent by closing in positive territory once again.
