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Business News/ Markets / Stock Markets/  Cochin Shipyard, Garden Reach, Mazagon Dock gain up to 15% as market recovers from election result shock
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Cochin Shipyard, Garden Reach, Mazagon Dock gain up to 15% as market recovers from election result shock

PSU stocks show remarkable resilience, bouncing back in trading session. Defence stocks surge with shipbuilding stocks hitting upper circuit limits. Cochin Shipyard and Garden Reach Shipbuilders gain10% each in today's trade.

Other defence stocks such as HAL, Bharat Dynamics, and Bharat Electronics have also surged in today's trade in the range between 4% and 7% (AP)Premium
Other defence stocks such as HAL, Bharat Dynamics, and Bharat Electronics have also surged in today's trade in the range between 4% and 7% (AP)

Public Sector Undertaking (PSU) stocks have shown remarkable resilience, bouncing back strongly in Wednesday's trading session. This resurgence follows a smart recovery observed during the latter half of Tuesday's session, a trend that is persisting in today's market activity. 

Notably, alongside this upward trajectory, defence stocks have rekindled their bullish momentum, with shipbuilding stocks, in particular, hitting their respective upper circuit limits in today's session.

Also Read: BHEL share price jumps 14%, rises 19% in two days. More steam left?

Cochin Shipyard shares halted a three-day losing streak by rallying 10% to 1,853 in today's intraday session. Similarly, Garden Reach Shipbuilders also gained 10% to 1,298 apiece after two consecutive days of decline.

Mazagon Dock shipbuilders staged a robust recovery, surging nearly 15% intraday to reach 3,214 apiece. Despite recent fluctuations, all three stocks have delivered impressive returns. 

Mazagon Dock has seen a remarkable 223% increase over the last year, while Cochin Shipyard and Garden Reach Shipbuilders & Engineers have soared by 563% and 154%, respectively, in the same period.

Also Read: RBI meet underway: MPC likely to keep repo rate steady; 4 crucial reasons why

This impressive rally in these stocks can be attributed to several factors, including robust order wins, increased budget allocation, and the government's focus on reducing defence imports while promoting domestic procurement. 

Additionally, improvements in defence exports and enhanced financial performance have significantly heightened investor interest in defence stocks, driving them to achieve record highs.

Meanwhile, the resurgence in PSU came after reports showed that Prime Minister Modi-led BJP is poised to form a coalition government with the support of its allies at the center. After the Bharatiya Janata Party (BJP) fell short of securing an outright majority in parliamentary elections, it was compelled to engage in coalition discussions. 

Also Read: Multibaggers: 3 shipbuilding stocks including Cochin Shipyard gained between 200% and 725% in a year

Leaders representing the National Democratic Alliance (NDA), such as Nitish Kumar of Janata Dal (United) and N. Chandrababu Naidu of the Telugu Desam Party, met in New Delhi on Wednesday to work out an agreement. In a social media post on Wednesday, the BJP announced that Modi had been "unanimously elected as the leader of the NDA," solidifying his position within the alliance.

Also Read: KCP, Heritage Foods extend rally for second session as TDP gains power in AP

Following this, investors turned optimistic about the government's commitment to economic reforms, infrastructure development, and other initiatives aimed at promoting growth and job creation. This positive outlook has contributed to the renewed interest in PSU stocks, driving their upward trajectory in the market.

Meanwhile, other defence stocks such as HAL, Bharat Dynamics, and Bharat Electronics have also surged in today's trade in the range between 4% and 7%

 

Disclaimer: We advise investors to check with certified experts before taking any investment decisions.

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Published: 06 Jun 2024, 01:04 PM IST
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