Sensex stages biggest rally since April as FIIs turn aggressive buyers

Mumbai: The Sensex on Thursday notched up its biggest single-day gains since April as overseas funds bought the most into Indian stocks in more than two years. The US midterm results sank oil prices and buoyed bets a Democratic congressional control would limit White House policy flip-flops and discourage artificial intelligence-heavy trades.

Foreign institutional investors (FII) bought ₹14,975 crore worth of stock, provisional data on the NSE showed. This was the single-biggest daily buying by overseas funds since September 2024.

The BSE Sensex surged 2,008.61 points, or 2.60%, to close at 79,310.01, while the NSE Nifty climbed 576 points, or 2.40%, to settle at 24,536.60. By points, the Sensex logged its biggest gains since early April, when it began a short-lived recovery.

This was following the start of the Iran war.

“The markets may worry less about ad-hoc policies during his (US President Donald Trump’s) remaining tenure,” said Vinay Jaising, CIO and senior managing partner at ASK Private Wealth. “The US midterm verdict, with Democrats gaining control of the Congress, points to gridlock in Washington rather than a policy reversal. Without a majority (for Republicans), big-ticket decisions will be harder to pass for Trump.”

In his view, the outcome is positive for India and the rest of the world, as open-ended spending on tariffs or military conflict will be harder to push through, reducing the risk of sudden shocks to global trade.
Indian equities have underperformed global markets due to a weaker rupee, limited AI exposure, soft earnings and high crude prices, Jaising said. Three of these factors are now turning in India’s favour, with the rupee stabilising and earnings showing signs of recovery.The latest rally has also raised expectations of a possible turnaround in Indian equities, which have underperformed global markets this year.

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“As a large oil importer, India would also gain from lower crude through a lower trade deficit, a firmer rupee and softer inflation. As these factors play out, India is well placed to regain investor attention,” he said.

The rally was broad-based, with the Nifty Bank gaining 3.33% and the Nifty Midcap 100 advanced 1.87%. The Nifty Midcap 150 index rose nearly 2% and the Nifty Smallcap 250 index gained 0.8%.

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Market breadth remained firmly positive, with 2,411 stocks advancing against 921 declining on the NSE.

Easing crude oil prices, with Brent falling below $95 a barrel, raised expectations that inflationary pressures would ease and boost India’s macroeconomic outlook.

Positive global cues following gains in the US markets and expectations of a de-escalation in the Middle East tensions also supported sentiment, said Sunny Agrawal, head of fundamental equity research, SBICAPS Securities.

Among Nifty 50 constituents, Bajaj Finance, Shriram Finance and Mahindra & Mahindra were among the leading gainers, rising 7.7%, 6.1% and 5.6%, respectively.