Sensex gains nearly 600 points: What's behind today's rally?
What's the story
The Indian stock market opened on a positive note today, with the Sensex and Nifty indices witnessing significant gains. The upward movement was mainly led by a recovery in IT stocks after yesterday's massive selloff. At the time of writing, the Sensex was up by 576 points to trade at 82,802 while the broader Nifty rose by a similar margin of 199 points to settle at 25,623.
Sector performance
IT stocks lead market recovery
The market recovery was led by a strong performance from IT stocks, which gained after a sharp decline in the previous session due to AI concerns. The Nifty IT index surged nearly 3% to 30,839.05 at 9:20am with Persistent Systems, Mphasis and Coforge leading the gains by rising over 3% each. Other sectoral indices also traded in the green with metals witnessing a strong rise as well.
Expert insights
Caution advised after yesterday's fall
Market analysts have advised caution after yesterday's fall. "Markets remain highly sensitive to geopolitical risks and sector-specific pressures, driving investors toward defensive, domestically focused segments," said Vinod Nair, Head of Research at Geojit Investments Limited. The caution comes as the US and Iran are amid rising concerns of a possible military conflict between them that could disrupt supply chains.
Investor activity
Foreign investors continue to sell
Today's stock market rise comes even as foreign investors continue to sell. According to NSE data, FIIs net sold equities worth ₹102.53 crore yesterday. However, domestic institutional investors remained net buyers, purchasing equities worth ₹3,161 crore. The divergence in investor behavior highlights the complex dynamics of the current market environment and its impact on stock performance across various sectors.