Sensex soars over 600 points, Nifty reclaims 24,190 as FIIs return and blue-chips rally
The Indian stock market had a glorious start to the week, making a stunning recovery after Friday’s weak close. The calf-spine of the benchmark indices surged in the Monday early trade, reflecting a spirit of renewed optimism engulfing Dalal Street.
At the time of reporting, the S&P BSE Sensex increased by 604.51 points to break through at 79,817.04, while NSE Nifty50 increased by 148.90 points to trade at 24,190.35. The broader markets joined the trend, with the midcap and smallcap indices showing strong gains, showing that the positive mood was felt across the entire market.
Factors Contributing to Today’s Rally
Today’s market witnessed an upsurge due to multiple reasons. Heavy-weight stocks like Reliance Industries, Mahindra & Mahindra (M&M), and the banks were making large upward moves, and this was exactly the momentum the market needed.
First, Reliance led the pack after news reports came out on new developments concerning the IPO of its retail arm. M&M was also seeing fresh buying following the release of strong monthly sales numbers in March that were way above street expectations.
Meanwhile, some momentum has also returned to the financials, with many investors building positions. Iconic banks and financial services companies underwent sharp buying, instilling that the revival is now building confidence in the sector. With the likes of HDFC Bank, ICICI Bank, and State Bank of India paving the way for the rally, these stocks were instrumental to the gains of Nifty and Sensex.
FIIs Return Amid Global Tailwinds
A huge catalyst behind the index being strong today is also the return of FII inflows. The weakening of the dollar, along with US economic indicators that show weakness, affirm that global investors are pulling back money to emerging markets, with India benefiting largely.
Provisional figures for the markets show that FIIs have now been net buyers for four days straight, halting the trend of selling that prevailed earlier in the month of April. Strong domestic macroeconomic fundamentals combined with a good valuation environment drive foreign funds toward India.
Another positive backdrop for emerging markets has been the declining US treasury yields, along with dovish comments by Federal Reserve officials regarding potential rate cuts in 2025. Indian equities are still a top pick for global investors, given their strong corporate earnings outlook and political stability.
Technical Outlook and Market Caution
Cautions should be displayed for the short term, despite a vigorous start, according to technical indicators. Market analysts noted last week the development of an evening star-ish formation on daily charts, which would indicate a potential reversal after a long uptrend. Last Friday’s landslides only gave more credence to this assumption.
James, a leading technical analyst, has said that Nifty50 is immediately supported around the 23,670 zone. Should the selling pressure persist, a much larger correction extending towards the 23,300-23,050 zone could play out. However, the late-session recovery on Friday from March highs offers hope that the ongoing rally could regain momentum swiftly.
Analysts further suggested that as long as Nifty50 holds above the key psychological level of 23,500, the broader uptrend remains intact. Momentum indicators like RSI (Relative Strength Index) and MACD (Moving Average Convergence Divergence) continue to stay in bullish territory, implying underlying market strength.
Performance by Sectors
Today’s gains were widespread across sectors:
Energy: Reliance Industries and ONGC, and Oil India led the energy pack higher, buoyed by rising crude oil prices and strong operational updates.
Auto: The auto index outperformed its peers, with M&M, Tata Motors, and Maruti Suzuki having recorded handsome gains on the back of improved domestic demand and robust export figures.
Banking and Financials: The major private sector banks rallied, supported by improvement in asset quality and steady loan growth for the March quarter.
Information Technology: Maintain constant demand. Information technology stocks showed spunk, despite grumbling over declining US demand. Infosys and TCS traded a tad better as many investors expected them to benefit in the future from a softer rupee.
Realtor Markets: As robust sales figures in the metropolitan market continue to dominate this sector, coupled with favorable interest rates, the real estate sector keeps up its strong run.
Broader Market Action
The Nifty Midcap 100 and Nifty Smallcap 100 indices gained over 1.5% each, exceeding benchmark indices. This impressive showing in broader markets highlights the improvement in risk appetite among investors and their growing confidence over the recovery of earnings in smaller firms.
Advances significantly outnumbered declines on the NSE, further affirming the bullish undercurrents. Quite a few midcap stocks from the chemical, real estate, and capital goods sectors hit fresh 52-week highs.
Snapshot of the Global Market
Asian markets traded mixed today, with Japan’s Nikkei and South Korea’s Kospi posting marginal losses, while Hong Kong’s Hang Seng edged higher. However, investors were globally on high alert ahead of critical macroeconomic data this week, including GDP growth and inflation figures on the US front.
European futures showed soft positive opening points, since there are lessening bond yields and the Eurozone outlook stays stable. Meanwhile, US futures were also subtly promising after last Friday’s sharp fall for a rebound.
Some Corporate Developments
Several actions of corporations also influenced today’s trading:
Adani Enterprises announced a gigantic tie-up with a leading global logistics player and thereby inferring its stock price will hike by almost 4%.
Bharti Airtel gained over 2% on brokerage upgrades, citing better ARPU (Average Revenue Per User) estimates and stable additions to subscriber numbers.
Tata Steel remained in the limelight ahead of its quarter results coming out later this week. The company kept addition buoyant on sentiments by giving management’s positive commentary on steel demand trends for India and Europe.
This Week’s Outlook
Market experts have a conjecture that today’s strong beginning could extend to a whole week ahead as long as global cues remain around the supportive range. While the earnings season would continue influencing movement stock-wise, macro data releases from the US and Europe may further add actions for volatility.
Volatility index (India VIX) remains at relatively low levels, indicating that investors are not pricing in significant near-term risks. However, any unexpected developments on the geopolitical or economic front could quickly alter sentiments.
Nifty50 faces immediate resistance near 24,300, followed by 24,500 levels. Sustaining above these barriers could pave the way for a move towards 25,000 in the coming months. On the downside, 23,600–23,500 serves as crucial support to watch.
The Indian stock market started the new week with a resounding rally, powered by heavyweight stocks, strong foreign inflows, and positive domestic triggers. While the underlying trend remains bullish, technical signals suggest keeping an eye on support levels to guard against potential pullbacks. The combination of global liquidity, corporate earnings momentum, and favorable policy environment continues to favor equities in the near term.
