Indian Equity Markets Extend Winning Streak
Indian equity benchmarks continued their upward trajectory for the third consecutive session on Tuesday, bolstered by positive global cues and domestic buying. The 30-share BSE Sensex climbed 544.15 points, or 0.71 percent, to close at 76,808.48. Similarly, the NSE Nifty50 index advanced 135.25 points, or 0.57 percent, settling at 23,989.15.
Broader market indices also ended in positive territory, reflecting the widespread optimism. The Nifty Midcap100 rose by 0.41 percent, while the Nifty Smallcap100 gained 0.42 percent.
Investor Wealth Surges by Nearly ₹20 Lakh Crore
The sustained rally translated into substantial gains for investors, with the market capitalization (m-cap) of BSE-listed companies witnessing a significant increase. On Tuesday alone, the m-cap rose by approximately ₹1.75 lakh crore, reaching ₹472.24 lakh crore from ₹470.49 lakh crore in the previous session.
Over the past three trading sessions, investor wealth, as measured by BSE m-cap, has surged by an impressive ₹19.91 lakh crore, climbing from ₹452.33 lakh crore recorded on June 11.
Key Drivers and Sectoral Performance
Several factors contributed to the market's robust performance. Easing geopolitical concerns in West Asia, particularly optimism surrounding de-escalation in US-Iran tensions, played a crucial role. Additionally, softer crude oil prices and a strengthening rupee provided further support to investor sentiment.
Major contributors to the Sensex gains included heavyweights like Reliance Industries Ltd (RIL), HDFC Bank Ltd, ICICI Bank Ltd, Bharti Airtel Ltd, Bajaj Finance Ltd, HCL Technologies Ltd, Hindustan Unilever Ltd (HUL), Tata Consultancy Services Ltd (TCS), and ITC Ltd.
Sectorally, the rally was broad-based, with significant gains observed in IT, consumer durables, energy, media, FMCG, and realty sectors, which advanced between 1-2 percent. However, metal stocks lagged, primarily due to a sharp pullback in global metal prices as supply-side concerns began to subside.
Analyst Insights and Future Outlook
Vinod Nair, Head of Research at Geojit Investments, noted that domestic equity markets continued their recovery, buoyed by growing optimism around geopolitical de-escalation and softening crude oil prices. He highlighted the broad-based nature of the rally but pointed out that metal stocks were an exception.
Sunny Agrawal, Head - Fundamental Research at SBI Securities, corroborated the broad-based buying across large-cap stocks. Ankur Punj, MD & Business Head at Equirus Wealth, specifically mentioned the positive market reaction to the anticipated peace deal between the US and Iran, leading to buying in previously beaten-down stocks and a rebound in the IT sector.
Notably, Foreign Institutional Investors (FIIs) turned net buyers on Monday for the first time this month, further supporting the market. Investors are now keenly awaiting the upcoming US Federal Reserve policy meeting, looking for forward guidance on monetary policy and interest rate trajectory.
Rupee Strengthens Amid Optimism
On the currency front, the Indian rupee traded stronger, gaining around 0.15 percent or 11 paise, nearing 94.55 against the dollar. Jateen Trivedi, VP Research Analyst - Commodity and Currency at LKP Securities, attributed this strength to continued optimism surrounding the US-Iran peace negotiations.
The rupee's future movement will also be influenced by the Federal Reserve's policy decision and FII flows, with sustained foreign inflows expected to provide further support. Technically, the rupee's outlook remains positive as long as geopolitical developments remain constructive, with a near-term trading range seen between 94.80 and 94.