Synopsis: The Indian stock market has experienced a significant rise today, with both the Nifty 50 and Sensex showing a considerable rally. Investors and traders are closely watching the evolving global and domestic market conditions as they try to understand the reasons behind this Bull market.
In today’s session, both indices opened a bit lower, reflecting negative sentiment from the start. As trading continued, buying pressure increased, causing a further rally in the indices. This led to a sharp rise in intraday gains for both the Sensex and Nifty, highlighting the optimistic sentiment among market participants
Index Overview
The Benchmark indices Sensex and Nifty are poised to break their three-day losing streak on Wednesday, powering ahead to sit within touching distance of their record highs.
The Nifty Index opened at Rs. 25,842.95, with a slight gap down opening from its previous close of Rs. 25,884.80, and the index has recovered and rallied almost 370 points from the day’s low of Rs. 25,842.95.
The Sensex Index opened at Rs. 84,503.44, with a slight gap down opening from its previous close of Rs. 84,587.01, and the index has recovered and rallied almost 1,150 points from the day’s low of Rs. 84,478.13.
Here are the top factors for the rally
Global markets rally
Asian equities gained on Wednesday, following overnight gains in U.S. markets, as softer U.S. economic data bolstered expectations of a Federal Reserve rate cut at next month’s policy meeting. MSCI’s broadest index of Asia-Pacific shares outside Japan rose by 1%, while Japan’s Nikkei surged 1.8% and the U.S. stock futures also edged up 0.2% in early trading.
On Tuesday, U.S. markets continued their rebound, with the S&P 500 and Nasdaq Composite notching their third consecutive day of gains. This momentum was fueled by weaker-than-expected retail sales and a decline in consumer confidence, both of which reinforced the likelihood of an upcoming Fed rate cut.
Growing expectations for a U.S. Fed rate cut
After initial concerns, markets are now optimistic about a potential U.S. Federal Reserve rate cut in the upcoming December policy meeting, the last of 2025, and weaker-than-expected U.S. economic data further supported these expectations today. According to CME Group’s Fedwatch tool, 85% of market participants anticipate that Jerome Powell and the Federal Reserve will lower interest rates.
Falling crude oil prices
Oil prices, currently slightly above $60, are nearing a one-month low due to concerns that global supply could surge next year, outpacing demand. For India, which heavily relies on oil imports, falling prices would reduce its import bill and benefit stocks dependent on the commodity.
JP Morgan has predicted that Brent crude could dip into the $30s by FY27, driven by an oversupply, especially from non-OPEC+ producers. While global oil consumption is expected to rise, the supply glut is projected to outstrip demand growth, potentially benefiting Indian markets by lowering oil costs.
FII buying
On November 25, FIIs became net buyers, purchasing equities worth Rs 785 crore. “FII selling is expected to decrease as the AI trade fades and India’s equity prospects improveand corporate earnings in India should pick up during Q3 and continue to accelerate into CY 2026, which could reverse FII outflows,” said V K Vijayakumar, Chief Investment Strategist at Geojit Investments.
Broad-based Buying
Markets witnessed broad-based buying on Wednesday, driven by heavyweight stocks, with the broader indices outperforming. Both midcap and smallcap indices surged over 1%, recovering sharply after a volatile session on Tuesday due to the November series derivatives expiry.
RBI MPC meet
At its final policy meeting of the year on December 3–5, the Reserve Bank of India is expected to cut the repo rate by 25 basis points, given recent surprises in CPI inflation. The RBI is likely to maintain a cautious and wait-and-watch approach as it evaluates the impact of its recent easing measures, spanning interest rates, liquidity management, and regulatory changes, before deciding on further action.
Written by Sridhar J
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