Indian benchmark indices ended higher on Wednesday, recovering from their biggest single-day loss in a month during the previous session, supported by gains in IT and commodities stocks as softer-than-expected inflation data for both the U.S. and India in April raised hopes for further rate cuts.
The BSE Sensex advanced 182.34 points, or 0.22%, to close at 81,330.56, while the Nifty 50 gained 88.55 points, or 0.36%, to close at 24,666.90.
The market capitalization of all listed companies on the BSE increased by Rs 3.12 lakh crore to Rs 434.97 lakh crore.
Sector Watch
Ten of the 13 major sectors advanced, with information technology, oil & gas, and metals leading the way. Shares of heavyweight stocks such as Infosys, Reliance Industries, Tata Steel, Bharti Airtel, Mahindra & Mahindra, and TCS were the top gainers on the Nifty 50, advancing between 0.9% and 1.5%.
IT stocks, which derive a significant portion of their revenue from the U.S., gained support from favorable U.S. inflation data, which raised optimism about tech spending in the world’s largest economy. The Nifty IT index closed 1.4% higher.
U.S. consumer inflation increased by 0.2% in April, lower than the 0.3% monthly rise predicted by economists polled by Reuters.
A decline in the dollar, fueled by softer U.S. inflation data and easing trade tensions, also supported metal stocks, which rose 2.5%.
Tata Steel, a heavyweight in the sector, surged 3.9%, emerging as one of the biggest gainers on the metals index. Several brokerages highlighted strong volume growth and cost optimization as key positives for the company, following a fourth-quarter profit beat reported on Monday.
Meanwhile, the Nifty Oil & Gas index closed 1.3% higher on the day.
India’s retail inflation, which slowed to a near six-year low on Tuesday, further boosted expectations for additional rate cuts by the central bank.
However, market participants remain cautious amid concerns over foreign capital flows potentially shifting to China after the country struck a deal with the U.S. to temporarily reduce reciprocal tariffs.
The broader Nifty Midcap 100 and Nifty Smallcap 100 indices gained 1.2% and 1.5%, respectively, extending their outperformance over the benchmark indices, driven by post-earnings rallies in key constituents.
Expert View
Market optimism is gaining momentum, driven by a sharp decline in both global and domestic risks, said Vinod Nair, Head of Research at Geojit Investments, adding that in this environment, the broader markets are on an upswing, supported by a strengthening recovery in local demand, as reflected in the March quarter corporate earnings.
Nair said that this has sparked a rally in mid-cap and small-cap stocks, which had underperformed earlier due to premium valuations, earnings downgrades, and moderation in foreign institutional investor (FII) and Retail inflows.
"Currently, Midcaps are witnessing renewed interest, fuelled by marginal upgrades in recent earnings and the potential for a stronger rebound in FY26. Contributing factors include a consistent decline in inflation, rising disposable incomes, increased government spending, and falling interest rates. Meanwhile, a pause in global trade tensions is boosting sentiment in international markets, with metals gaining traction amid easing concerns over an economic slowdown," said Nair.
As long as the Nifty stays above the crucial support level of 24,400, the bulls are likely to maintain their grip, said Rupak De, Senior Technical Analyst at LKP Securities.
"In the near term, the index might move towards the 24,850–25,000 range. However, a drop below 24,400 could delay this upward trajectory and lead to further consolidation," said De.
Global Markets
European stocks were largely unchanged as markets paused after a strong rally driven by easing global trade tensions, while Asian stocks climbed as U.S. inflation data raised expectations for Federal Reserve rate cuts.
A truce in the tariff dispute between China and the U.S. has temporarily eased global trade tensions, fueling a rise in global equities. Europe's STOXX 600 slipped less than 0.2%, taking a breather after surging over 17% since April 9, when U.S. President Donald Trump announced a pause in most reciprocal tariffs on U.S. trading partners.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 1.4%, while Japan's Nikkei 225 edged down 0.1%.
Hong Kong's Hang Seng index rose 2%, buoyed by strong results from Chinese e-commerce giant JD.com. Investors are now focused on upcoming earnings from Tencent and Alibaba.
With U.S. inflation data now out, the next key economic indicator will be retail sales data for April, due Thursday. The same day, talks are scheduled between Ukraine and Russia in Istanbul, with hopes of achieving a ceasefire after nearly three years of conflict.
Spot gold fell 0.3% to $3,237 per ounce, as reduced trade tensions lessened its appeal as a safe haven.
Crude Impact
Oil prices dropped on Wednesday as traders anticipated a potential rise in U.S. crude inventories, awaiting official weekly data and OPEC's monthly oil report later in the day.
Brent crude futures fell 64 cents, or about 1%, to $65.99 per barrel by 0934 GMT, while U.S. West Texas Intermediate (WTI) crude declined 64 cents, or 1%, to $63.03.
Rupee vs Dollar
The Indian rupee ended slightly stronger on Wednesday, as strong dollar demand from state-run and foreign banks offset the positive impact of a broader weakness in the greenback, which supported most Asian currencies.
The rupee fluctuated between gains and losses throughout the session, ultimately closing just above its previous level at 85.27, compared to 85.33 on Tuesday.
Meanwhile, the dollar index, which measures the greenback's strength against a basket of six currencies, traded 0.64% lower at 100.35.
(with inputs from agencies)
The BSE Sensex advanced 182.34 points, or 0.22%, to close at 81,330.56, while the Nifty 50 gained 88.55 points, or 0.36%, to close at 24,666.90.
The market capitalization of all listed companies on the BSE increased by Rs 3.12 lakh crore to Rs 434.97 lakh crore.
Sector Watch
Ten of the 13 major sectors advanced, with information technology, oil & gas, and metals leading the way. Shares of heavyweight stocks such as Infosys, Reliance Industries, Tata Steel, Bharti Airtel, Mahindra & Mahindra, and TCS were the top gainers on the Nifty 50, advancing between 0.9% and 1.5%.
IT stocks, which derive a significant portion of their revenue from the U.S., gained support from favorable U.S. inflation data, which raised optimism about tech spending in the world’s largest economy. The Nifty IT index closed 1.4% higher.
U.S. consumer inflation increased by 0.2% in April, lower than the 0.3% monthly rise predicted by economists polled by Reuters.
A decline in the dollar, fueled by softer U.S. inflation data and easing trade tensions, also supported metal stocks, which rose 2.5%.
Tata Steel, a heavyweight in the sector, surged 3.9%, emerging as one of the biggest gainers on the metals index. Several brokerages highlighted strong volume growth and cost optimization as key positives for the company, following a fourth-quarter profit beat reported on Monday.
Meanwhile, the Nifty Oil & Gas index closed 1.3% higher on the day.
India’s retail inflation, which slowed to a near six-year low on Tuesday, further boosted expectations for additional rate cuts by the central bank.
However, market participants remain cautious amid concerns over foreign capital flows potentially shifting to China after the country struck a deal with the U.S. to temporarily reduce reciprocal tariffs.
The broader Nifty Midcap 100 and Nifty Smallcap 100 indices gained 1.2% and 1.5%, respectively, extending their outperformance over the benchmark indices, driven by post-earnings rallies in key constituents.
Expert View
Market optimism is gaining momentum, driven by a sharp decline in both global and domestic risks, said Vinod Nair, Head of Research at Geojit Investments, adding that in this environment, the broader markets are on an upswing, supported by a strengthening recovery in local demand, as reflected in the March quarter corporate earnings.
Nair said that this has sparked a rally in mid-cap and small-cap stocks, which had underperformed earlier due to premium valuations, earnings downgrades, and moderation in foreign institutional investor (FII) and Retail inflows.
"Currently, Midcaps are witnessing renewed interest, fuelled by marginal upgrades in recent earnings and the potential for a stronger rebound in FY26. Contributing factors include a consistent decline in inflation, rising disposable incomes, increased government spending, and falling interest rates. Meanwhile, a pause in global trade tensions is boosting sentiment in international markets, with metals gaining traction amid easing concerns over an economic slowdown," said Nair.
As long as the Nifty stays above the crucial support level of 24,400, the bulls are likely to maintain their grip, said Rupak De, Senior Technical Analyst at LKP Securities.
"In the near term, the index might move towards the 24,850–25,000 range. However, a drop below 24,400 could delay this upward trajectory and lead to further consolidation," said De.
Global Markets
European stocks were largely unchanged as markets paused after a strong rally driven by easing global trade tensions, while Asian stocks climbed as U.S. inflation data raised expectations for Federal Reserve rate cuts.
A truce in the tariff dispute between China and the U.S. has temporarily eased global trade tensions, fueling a rise in global equities. Europe's STOXX 600 slipped less than 0.2%, taking a breather after surging over 17% since April 9, when U.S. President Donald Trump announced a pause in most reciprocal tariffs on U.S. trading partners.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 1.4%, while Japan's Nikkei 225 edged down 0.1%.
Hong Kong's Hang Seng index rose 2%, buoyed by strong results from Chinese e-commerce giant JD.com. Investors are now focused on upcoming earnings from Tencent and Alibaba.
With U.S. inflation data now out, the next key economic indicator will be retail sales data for April, due Thursday. The same day, talks are scheduled between Ukraine and Russia in Istanbul, with hopes of achieving a ceasefire after nearly three years of conflict.
Spot gold fell 0.3% to $3,237 per ounce, as reduced trade tensions lessened its appeal as a safe haven.
Crude Impact
Oil prices dropped on Wednesday as traders anticipated a potential rise in U.S. crude inventories, awaiting official weekly data and OPEC's monthly oil report later in the day.
Brent crude futures fell 64 cents, or about 1%, to $65.99 per barrel by 0934 GMT, while U.S. West Texas Intermediate (WTI) crude declined 64 cents, or 1%, to $63.03.
Rupee vs Dollar
The Indian rupee ended slightly stronger on Wednesday, as strong dollar demand from state-run and foreign banks offset the positive impact of a broader weakness in the greenback, which supported most Asian currencies.
The rupee fluctuated between gains and losses throughout the session, ultimately closing just above its previous level at 85.27, compared to 85.33 on Tuesday.
Meanwhile, the dollar index, which measures the greenback's strength against a basket of six currencies, traded 0.64% lower at 100.35.
(with inputs from agencies)
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