Indian equity markets witnessed a significant rally on Monday, with benchmark indices, the Sensex and Nifty 50, both climbing more than 1%. The Sensex surged by 1,000 points in early trade, while the Nifty 50 crossed the 23,300 threshold. The bullish sentiment resulted in a rapid addition of over Rs 6 lakh crore to the total market capitalisation of companies listed on the BSE within the first hour of trading, bringing the cumulative value to Rs 480 lakh crore.
A primary driver of the market’s positive performance was the strong quarterly results from Reliance Industries. The company’s shares surged more than 5% after it reported a 41% year-on-year rise in consolidated net profit, reaching Rs 25,548 crore for the July-September quarter of FY27. Jio Platforms also contributed to the positive momentum, with its shares rallying over 3% following a 14% increase in its own quarterly net profit.
Global energy factors also played a pivotal role in boosting domestic investor confidence. Oil prices fell by more than 3% as diplomatic efforts continued between Iranian and Qatari officials aimed at ending the ongoing conflict in the region. Brent crude futures retreated to Rs 110 per barrel, while US West Texas Intermediate (WTI) crude futures fell to Rs 101 per barrel. This decline in energy costs is widely viewed as a relief for India’s import-dependent economy.
Investor sentiment was further bolstered by the return of foreign institutional investors (FIIs) as net buyers of Indian equities. After a period of consistent selling throughout last month and the first half of October, FIIs have purchased nearly $1.2 billion in shares over the past 10 trading sessions. Provisional data from the National Stock Exchange indicated continued purchasing activity from these investors, with net inflows amounting to Rs 3,599 crore in the most recent session.
Broader market indicators reflected this positive trend, with the Nifty Smallcap 250 and Nifty Midcap 100 indices both gaining approximately 0.6%. Market breadth remained firmly positive, with 2,053 advances against 921 declines on the NSE. Among sectoral indices, the Nifty Oil & Gas sector led the gains with an increase of nearly 3%, while Nifty Metal, Nifty PSU Bank, and Nifty Consumer Durables also saw gains exceeding 1%. Conversely, the Nifty Pharma index bucked the trend, slipping into the red.
Market participants are also reacting to speculation regarding potential government intervention in tax policies. There is growing anticipation concerning potential relief on long-term capital gains (LTCG) tax and securities transaction tax, following remarks by Finance Minister Nirmala Sitharaman that discussions on these levies remain ongoing. Analysts suggest that any policy adjustments in this area could further encourage foreign capital inflows.
The domestic currency also showed signs of strength, with the rupee rising to 94.8850 against the US dollar from its previous closing of 94.95. Market analysts from LKP Securities noted that the decline in precious metal prices and speculation regarding potential policy measures to attract investment have supported the rupee. Moving forward, observers expect the currency’s trajectory to be dictated by global dollar trends and future government policy developments, with a projected near-term range of 94.50 to 95.50.
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