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The overall market capitalisation of companies listed on the Bombay Stock Exchange (BSE) increased sharply to nearly Rs 425 lakh crore from about Rs 422 lakh crore in the previous session, making investors richer by nearly Rs 3 lakh crore in just one day.
The
BSE Sensex rose over 1000 points, or 1.29 per cent, to 80,239.40 , while the NSE Nifty 50 climbed 292.30 points, or 1.22 per cent, to 24,329.90. The early gains come after a strong week where the Nifty added 0.8 per cent, closing at 24,039.35 for the week ended 25 April 2025.
The BSE Midcap and Smallcap indices also gained approximately one per cent during the session.
The overall market capitalisation of companies listed on the Bombay Stock Exchange (BSE) increased sharply to nearly Rs 425 lakh crore from about Rs 422 lakh crore in the previous session, making investors richer by nearly Rs 3 lakh crore in just one day.
Market experts have highlighted five major reasons behind today’s surge:
1. India‘s Measured Response to Pahalgam Attack
Despite uncertainty over future India-Pakistan relations following the Pahalgam terror strike, markets have appreciated India’s diplomatic and strategic handling of the crisis rather than an immediate military response.
The global community, including the United States, strongly condemned the attack. The
US State Department said Washington was in contact with both India and Pakistan, urging them to seek a “responsible solution” amid rising tensions,
Reuters reported.
VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, stated, “The heightened uncertainty relating to Indo-Pak tensions will weigh on the markets. It is very difficult to judge how much the market has discounted. Going by the market’s resilience, it can be said that the market has not discounted a scenario of the tensions culminating in a war between the two countries.”
2. Easing Global Trade War Jitters
Hopes of a resolution to the US-China trade tensions have provided additional tailwinds for Indian equities.
Reports indicate that US President
Donald Trump has confirmed active negotiations with China for a favourable trade deal, although he warned that tariff reductions would require major concessions.
“The peak of tariff-related anxiety appears to be behind us, and things are gradually improving,” said
Pankaj Pandey, Head of Research at ICICI Securities.
3. Sustained Buying by Foreign Portfolio Investors (FPIs)
Robust buying by foreign portfolio investors (FPIs) has significantly bolstered market sentiment since 15 April.
“The major factor contributing to the resilience of the market is the sustained buying by FIIs (foreign institutional investors), which has amounted to Rs 32,465 crore in the last eight days,”
Vijayakumar added.
He explained that a weakening US economy, coupled with a softer dollar, has prompted FPIs to favour emerging markets like India, reversing their earlier selling trend.
Gains in heavyweight stocks also supported the rally.
Reliance Industries’ share price jumped over 3 per cent after analysts reaffirmed their positive outlook and raised target prices following better-than-expected March quarter results. Reliance reported a 6 per cent year-on-year rise in consolidated profit for Q4FY25.
Meanwhile, strong earnings from major banking players like ICICI Bank, HDFC Bank, and Axis Bank further lifted market benchmarks.
“Fourth-quarter (Q4) earnings have largely met expectations. Encouragingly, key sectors such as banking are showing strong performance. The IT sector’s results have been broadly in line with forecasts, while the cement sector has delivered a strong performance,” said Pankaj Pandey.
5. Positive Long-Term Market Outlook Fuels ‘Buy on Dips’ Strategy
After two consecutive sessions of declines, the positive medium to long-term outlook for the Indian economy has encouraged investors to buy into dips.
“The Indian growth story is intact, with many avenues for investing across sectors where we see longer-term growth potential in areas like healthcare, the digital ecosystem, electronics manufacturing, capital goods and defence, etc. India is also largely domestically driven versus some other economies, which are heavily dependent on external trade,” said
Varun Sharma, Fund Manager at Motilal Oswal Mutual Fund.
Prospects of a normal monsoon have further boosted confidence in the domestic growth narrative.
