Bharti Airtel, Hero MotoCorp, Bajaj Auto Eicher Motors, M&M, Tata Consumer Products, TCS, Reliance, JSW Steel and Titan were among major gainers in the Indian markets on Thursday. The market sentiment has turned positive after four sessions of gains for Indian stocks. US markets are still showing mixed signals. Indian equity markets recorded a substantial recovery for the fourth consecutive trading session, fueled by robust global signals and diminishing fears of aggressive monetary policy tightening by the U.S. Federal Reserve. The BSE Sensex soared approximately 900 points, breaching the psychologically important 76,000 mark to close at 76,348.06, while the Nifty rose nearly 1.24%, finishing close to 23,200. The positive momentum follows a challenging period marked by intense foreign institutional selling, which recently drove many frontline stocks to their annual lows. Despite the ongoing optimism, market participants continue to express caution amid underlying economic uncertainties and volatility factors, urging investors to maintain vigilance.

Market Resurgence: Sensex and Nifty Record Impressive Gains

The benchmark Sensex surged by 900 points (1.19%) to finish at 76,348.06, marking a decisive break above the crucial 76,000 level. This substantial rally represents a robust recovery and extends its upward trajectory to the fourth consecutive session.

Similarly, the Nifty 50 index rose significantly, gaining 283.05 points (1.24%) to settle at 23,190.65, narrowly missing the key 23,200 psychological threshold. Over the last four sessions, the Sensex has accumulated gains exceeding 2,500 points (approximately 3.41%), while the Nifty has advanced roughly 800 points (3.54%).

Federal Reserve’s Dovish Stance Fuels Global and Domestic Optimism

A key driver behind the recent bullish sentiment has been the U.S. Federal Reserve’s reaffirmation of its plan to implement two rate cuts in 2025, despite persistent inflationary challenges stemming from tariffs and trade tensions. The Fed’s accommodative stance provided global markets with reassurance, triggering widespread optimism and a positive ripple effect on Indian indices.

Ajit Mishra, Senior Vice President at Religare Broking, emphasized this development: "The Fed's commitment to maintaining rates at current levels, indicating potential future cuts, has boosted confidence globally and set the stage for today’s market strength domestically."

Sector-Wide Participation and Short Covering Drive Gains

While trading began cautiously, the markets rapidly gained momentum through aggressive sector-wide buying and short covering, typical on weekly expiry days. Initially, the Nifty traded within a limited range; however, consistent buying pressure across major sectors quickly transformed the session into a broad-based rally.

All sectoral indices on both the BSE and NSE ended positively, spearheaded by robust gains in telecom, automotive, information technology, energy, and oil & gas stocks, underlining widespread investor enthusiasm and confidence.

Market Volatility Declines Significantly

Market volatility, measured by the India VIX index, declined by 5.22% to settle at 12.60, marking a clear reduction in investor anxiety and market uncertainty. The notable decrease in volatility suggests an easing of fear among traders and investors, enabling greater market stability and encouraging renewed confidence to re-enter equity markets after the previous sell-off.

Broader Indices Continue Upward Trajectory but Lag Benchmark Indices

The broader indices—BSE Midcap and BSE Smallcap—continued their upward trend but underperformed relative to the major benchmarks during Thursday’s session. Specifically, the BSE Midcap index appreciated by 0.61%, while the BSE Smallcap rose by 0.73%, modest figures compared to their stronger performance in prior sessions.

Nonetheless, over the past four trading days, the cumulative gains are notable: BSE Midcap climbed 5.88%, and BSE Smallcap advanced by 5.73%, underscoring resilient investor interest in mid-sized and smaller stocks, though perhaps tempered slightly amid heightened selectivity.

Positive Market Breadth Signals Continued Confidence

Investor sentiment remained positive, reflected by strong market breadth, with advancing stocks comfortably outnumbering declining issues. On Thursday, a total of 2,410 stocks ended in positive territory, while approximately 1,606 stocks posted losses. This favorable ratio indicates broad market support, extending beyond major blue-chip stocks and underscoring investor optimism.