Mumbai: The Nifty crossed 23,900 for the first time in two months on Wednesday, and the Sensex traded at 77,227 in the afternoon, up 309 points. It was the fifth straight session of gains for both benchmarks, and the trigger is not an Indian one.
Foreign portfolio investors bought Rs 6,837 crore of Indian equities on Tuesday, provisional NSE data showed, while domestic institutions sold Rs 3,679 crore. Over the past 11 sessions, foreign investors have made net purchases of Rs 25,400 crore, according to NSDL data. That is a change of direction after two years in which their selling was the single biggest drag on the market.
Crude has done the rest. Brent has fallen more than 10% in two sessions to $105 a barrel from a recent high of $115, easing the import bill and the inflation arithmetic at a stroke.
Tuesday's close was the strongest in nearly two months: the Sensex settled at 76,917.85, up 1,226 points or 1.6%, and the Nifty at 23,811, up 371 points. Over four sessions, both indices had gained around 5%.
On Wednesday the buying spread across sectors. BEL was the top Nifty gainer, up 4.28% at Rs 396.35, with Adani Enterprises up 3.91% at Rs 2,694.70 and Max Healthcare up 3.10% at Rs 923.25. Realty and FMCG indices gained. Information technology slipped into the red, a reminder that the same AI anxiety pushing money out of American tech is pushing some of it towards India.
"Some global investors could also be diversifying away from large artificial intelligence-related investments following volatility in technology stocks. At the same time, the recent market correction has made Indian equities more attractive," Utsav Verma, head of research for institutional equities at Choice Equity Broking, said.
V K Vijayakumar, chief investment strategist at Geojit Investments, expects the rally to be led by large-caps: "The rally can be strong and can sustain since there will be short covering in many large-caps. Leading financials have more room to move up."
The US midterm results, with Democrats projected to take both chambers, were being watched in Mumbai for what they mean for tariffs and for the Iran conflict. Emkay Research said the implications for India are more geopolitical than market-related.
Nothing here is a forecast. A rally built on foreign flows can reverse on the same flows.