Indian benchmark indices rebounded sharply on Thursday after a weak opening, supported by strong buying in financial stocks, even as concerns lingered over U.S. tariff policies and a global economic slowdown.
At 1:15 pm, the BSE Sensex surged 1,319 points, or 1.71%, to 78,363, while the Nifty50 rose around 340 points to hit 23,800 mark.
The total market capitalisation of BSE-listed companies jumped by Rs 4 lakh crore to Rs 418.98 lakh crore.
Key factors behind today's rally:
1) Rally in banking stocks
Bank Nifty led the rally, climbing nearly 2%, driven by gains in heavyweight financials like HDFC Bank and ICICI Bank. These gains came ahead of their Q4 earnings, scheduled for April 19.
HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank together contributed 600 points to the Sensex’s 1,200-point surge.
2) FIIs buying
Foreign Institutional Investors (FIIs) remained net buyers for the second consecutive day, purchasing equities worth Rs 3,936 crore on Wednesday. In just two days, total FII inflows have crossed Rs 10,000 crore, signalling strong confidence in Indian equities.
“FIIs have turned buyers in India as the prospects for the US and China appear weakest in the current crisis. FIIs are likely to continue buying high-quality large caps in domestic consumption sectors,” said Dr. V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
3) Trade talk between Japan and US
Asian markets rose as traders assessed ongoing trade negotiations between the U.S. and Japan, even as uncertainties surrounding tariffs imposed by President Donald Trump kept sentiment fragile.
Japan's Nikkei gained 0.7%, while the yen weakened as Japan kicked off talks with the U.S. Trump, who unexpectedly joined the negotiations, declared "big progress" in discussions with lead Japanese negotiator Ryosei Akazawa.
“The U.S. regards India as one of four key allies—along with the UK, Japan, and South Korea—with whom it will strike trade deals first. If this materializes, India stands to benefit from the ongoing trade war between the U.S. and China,” said Dr. V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
4) Weakening Dollar
A falling dollar has boosted investor sentiment in emerging markets like India. A weaker dollar typically encourages foreign inflows and supports the rupee.
On Thursday, the dollar index dropped to 99.56, down from 109.88 in early February. This helped lift appetite for risk assets, especially in sectors like metals that are sensitive to currency movements.
5) U.S. tariff exemptions still supporting sentiment
Investor sentiment continues to benefit from U.S. President Donald Trump's earlier decision to postpone additional tariffs on 75 countries, including India, until July 9. The temporary relief, announced earlier this week, came as a breather amid rising global trade tensions. While the move initially triggered a relief rally in global equities, its impact remains supportive for Indian markets.
6) Crude Impact
Oil prices traded near $66 a barrel on Thursday, helping ease inflation concerns. Brent crude hovered around $66.40, while U.S. West Texas Intermediate (WTI) stood at $62.90. Lower crude prices are positive for India, which imports the majority of its oil, as they help reduce pressure on both the current account and inflation.
At 1:15 pm, the BSE Sensex surged 1,319 points, or 1.71%, to 78,363, while the Nifty50 rose around 340 points to hit 23,800 mark.
The total market capitalisation of BSE-listed companies jumped by Rs 4 lakh crore to Rs 418.98 lakh crore.
Key factors behind today's rally:
1) Rally in banking stocks
Bank Nifty led the rally, climbing nearly 2%, driven by gains in heavyweight financials like HDFC Bank and ICICI Bank. These gains came ahead of their Q4 earnings, scheduled for April 19.
HDFC Bank, ICICI Bank, Axis Bank, and Kotak Mahindra Bank together contributed 600 points to the Sensex’s 1,200-point surge.
2) FIIs buying
Foreign Institutional Investors (FIIs) remained net buyers for the second consecutive day, purchasing equities worth Rs 3,936 crore on Wednesday. In just two days, total FII inflows have crossed Rs 10,000 crore, signalling strong confidence in Indian equities.
“FIIs have turned buyers in India as the prospects for the US and China appear weakest in the current crisis. FIIs are likely to continue buying high-quality large caps in domestic consumption sectors,” said Dr. V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
3) Trade talk between Japan and US
Asian markets rose as traders assessed ongoing trade negotiations between the U.S. and Japan, even as uncertainties surrounding tariffs imposed by President Donald Trump kept sentiment fragile.
Japan's Nikkei gained 0.7%, while the yen weakened as Japan kicked off talks with the U.S. Trump, who unexpectedly joined the negotiations, declared "big progress" in discussions with lead Japanese negotiator Ryosei Akazawa.
“The U.S. regards India as one of four key allies—along with the UK, Japan, and South Korea—with whom it will strike trade deals first. If this materializes, India stands to benefit from the ongoing trade war between the U.S. and China,” said Dr. V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
4) Weakening Dollar
A falling dollar has boosted investor sentiment in emerging markets like India. A weaker dollar typically encourages foreign inflows and supports the rupee.
On Thursday, the dollar index dropped to 99.56, down from 109.88 in early February. This helped lift appetite for risk assets, especially in sectors like metals that are sensitive to currency movements.
5) U.S. tariff exemptions still supporting sentiment
Investor sentiment continues to benefit from U.S. President Donald Trump's earlier decision to postpone additional tariffs on 75 countries, including India, until July 9. The temporary relief, announced earlier this week, came as a breather amid rising global trade tensions. While the move initially triggered a relief rally in global equities, its impact remains supportive for Indian markets.
6) Crude Impact
Oil prices traded near $66 a barrel on Thursday, helping ease inflation concerns. Brent crude hovered around $66.40, while U.S. West Texas Intermediate (WTI) stood at $62.90. Lower crude prices are positive for India, which imports the majority of its oil, as they help reduce pressure on both the current account and inflation.
You may also like
ED seizes Rs 74 lakh cash during searches at Hyderabad firm's premises
New Hogwarts Legacy update is a must for modders - Patch notes confirmed
PM Modi's letter a lifelong inspiration for me: Vandana Katariya
"It's their prerogative": MEA on Australia's visa crackdown on Indians
NIA files charge sheet against 5 more individuals in 2022 Coimbatore blast case
