Sensex and Nifty rally as Indian stock market approaches all-time high

Mumbai: The combined market capitalisation of all Bombay Stock Exchange-listed companies has crossed ₹465 lakh crore, its highest level in 11 months.

The surge was driven by a broad-based rally and optimism over the resumption of India–US trade talks and the US Federal Reserve’s rate cut. The figure now stands just 2.7% below the all-time high recorded on 27 September 2024, with nearly ₹20 lakh crore added since the start of September.

Investor sentiment was also buoyed by expectations that the Reserve Bank of India (RBI) may ease policy in October as inflation shows signs of softening.

Benchmark indices Sensex and Nifty have climbed about 3.5% this month, narrowing the gap to record highs seen last September. State-run firms fuelled much of the rally, pushing the BSE PSU Index up 7.5%. The BSE 500 gained 5%, while BSE Auto rose 9%, Bankex advanced 6.8%, Metal added 8.1% and Oil & Gas climbed 4.5%.

Mid- and small-cap stocks also outperformed, with the BSE MidCap Index rising 4.7% and SmallCap gaining 6%.

Analysts said the Indian stock market is unlikely to be significantly affected by the US Fed’s move, noting that the current rally is supported by expectations of an earnings revival among Indian corporates. Market watchers projected corporate earnings growth above 15% in FY27, aided by ongoing structural reforms, which could also improve foreign portfolio investor sentiment.

Some analysts cautioned that valuations remain elevated, but pointed to strong earnings momentum led by banks, NBFCs and the consumption sector.

Meanwhile, the Nifty 50 stayed firmly above the 25,300 mark in the previous session, signalling investor comfort at higher levels. Analysts said the index shows potential upside momentum, with resistance expected in the 25,400–25,500 range and support intact at 25,000–24,900.

IANS