The Indian stock market delivered a spectacular bounce-back on Wednesday, completely reversing a three-day losing streak. Boosted by strong global cues and decisive buying from institutional investors, the Sensex soared by over 250 points, while the Nifty 50 successfully reclaimed the crucial 26,000 psychological level in early trade.
Early Market Performance: Key Numbers
The domestic equity market opened firmly in the green, indicating renewed confidence among traders.
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Sensex Start: Opened at 84,503.44 (just below its previous close of 84,587.01, then surged to trade at 84,785.06 by 9:16 AM marking a gain of 198.05 points (a 0.23% rise).
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Nifty 50 Start: Commenced at 25,842.95 and rallied to 25,950.60, marking an early gain of 65.80 points (a 0.25% rise).
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Sectoral Strength: The rally was broad-based, with all sectoral indices trading higher. Nifty Metal led the charge, jumping 1.76%, closely followed by PSU Banks at 1.62%.
Source: NSE, Livemint
Global & Institutional Drivers
The sharp recovery in the Indian stock market was primarily fuelled by two key factors: encouraging trends from overseas and a shift in Foreign Portfolio Investor (FPI) sentiment.
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Global Boost: Asian markets advanced by 0.9%, tracking an uptick on Wall Street. This momentum was generated by US data showing weaker-than-expected retail sales and consumer confidence, which significantly boosted expectations of a December US Fed rate cut. Market probabilities for a 25 basis point Fed cut now stand at an 83% chance, up sharply from 50% just a week ago.
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FPIs Return: Foreign portfolio investors (FPIs) turned net buyers of Indian stocks on Tuesday after two sessions of outflows, injecting 7.85 billion rupees (or ₹785.32 crore) into the cash segment.
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DII Support: Domestic institutional investors (DIIs) maintained their supportive role, purchasing stocks worth 39.12 billion rupees (₹3,912.47 crore), further anchoring the domestic equity market.
Source: Moneycontrol, Livemint
Key Domestic & Corporate Highlights
Investors are closely monitoring several domestic developments, which are contributing to the positive atmosphere and selective stock movements.
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RBI Commentary: Recent comments from RBI Governor Sanjay Malhotra, hinting at scope for further rate reductions, are powering rate-sensitive sectors ahead of the central bank’s policy decision next week.
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GDP Watch: The official July-September GDP growth data is due this Friday. A Reuters poll anticipates a 7.3% growth figure, following 7.8% in the preceding quarter.
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NCC Shares: Surged 1.76% after securing a major order worth 20.63 billion rupees (₹2,062.71 crore) for a Gauhati Medical College expansion project.
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Indian Overseas Bank (IOB): Set to receive a substantial income tax refund of 8.35 billion rupees.
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Zen Technologies: Bagged a 1.08 billion rupees order from the Ministry of Defence to supply tank crew gunnery training simulators.
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NELCO: Jumped 3.70% after securing additional regulatory authorisation to offer broader VSAT services.
Source: Moneycontrol, Livemint
The Bottomline
The spectacular turnaround in the Indian stock market shows that bulls are back in control, successfully reversing the recent three-day slump. With the Nifty 50 firmly above the 26,000 mark and the Sensex extending its gains, the near-term outlook for the domestic equity market remains positive.
The combination of strong institutional buying (FPIs and DIIs) and global optimism surrounding a possible Fed rate cut provides a robust foundation. Investors should closely track Friday’s GDP data and the RBI’s upcoming policy decision, as these events will determine the long-term trajectory of the Indian stock market rally.
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