Why stock market is rising today? Key reasons behind Sensex, Nifty rally

Why stock market is rising today: A day after the public holiday, benchmark indices surged sharply in early trade on Wednesday, tracking strong global cues and easing geopolitical concerns.

The BSE Sensex rose 1,363 points, or 1.77 per cent, to 78,210.96 at 9:15 am. It opened at 77,981.10 against the previous close of 76,847.57.

The Nifty 50 also climbed nearly 2 per cent, reflecting broad-based buying across sectors.

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US–Iran talks hopes lift sentiment

Investor sentiment improved after Donald Trump indicated that a second round of US-Iran talks could take place within two days, likely in Pakistan.

The possibility of renewed diplomatic engagement eased fears of escalation in West Asia. This comes after the first round of talks over the weekend failed to deliver a breakthrough.

Markets reacted positively as the development reduced geopolitical risk premiums.

Crude oil fall boosts outlook

Oil prices declined sharply, providing relief to global markets, including India.

Brent crude slipped below $95 per barrel after a steep fall in the previous session. US crude also dropped significantly.

Lower crude prices are positive for India, as they help ease inflation concerns and reduce pressure on the current account deficit.

Global markets rally

Global cues remained supportive.

Asian markets rallied strongly. Japan’s Nikkei rose about 1 per cent, while South Korea’s Kospi jumped 3 per cent. MSCI’s Asia-Pacific index ex-Japan gained 1.5 per cent to a six-week high.

Overnight, US markets ended higher. The Nasdaq gained 2 per cent, while the S&P 500 rose 1.2 per cent, close to record levels.

This global risk-on mood supported Indian equities.

Volatility cools, broader markets outperform

Market volatility declined sharply.

The India VIX dropped 15.4 per cent to 17.34, indicating reduced near-term uncertainty.

Broader markets outperformed frontline indices. Midcap and smallcap stocks saw strong buying interest.

Sectorally, PSU banks and IT stocks led gains. Pharma stocks lagged and remained the weakest segment in early trade.

Rupee strengthens

The Indian currency also supported sentiment.

The rupee appreciated by 12 paise to 93.23 against the US dollar in early trade, aided by lower crude prices and easing geopolitical tensions.

FIIs cautious, DIIs extend buying streak

Institutional flows remained mixed.

Foreign institutional investors (FIIs) stayed cautious. They turned net sellers in the cash market, offloading Rs 1,983 crore. Their overall exposure in equities also declined.

In contrast, domestic institutional investors (DIIs) continued to provide support. They extended their buying streak to the 31st session, purchasing equities worth Rs 2,432 crore.

Why markets are rising today

• Hopes of renewed US-Iran talks easing geopolitical risks
• Sharp fall in crude oil prices
• Strong global market cues
• Cooling volatility levels
• Continued DII buying support