Indian Stock Markets Surge: Nifty 50 Reclaims 9-Month High

In a remarkable turnaround, the Indian stock markets on Thursday closed with substantial gains, as the Nifty 50 at the National Stock Exchange (NSE) reclaimed its highest closing level in nearly nine months. At the finish line of trading, the Nifty climbed 304.25 points, or 1.21 percent, to 25,549, while the BSE Sensex added 1,000.36 points, or 1.21 percent, closing at 83,755.87.

The market's upward trajectory marked the third consecutive session of gains, fueled by relaxed tensions in the Middle East. 'The index not only surpassed the psychological 25500 mark but also sustained its position above it, hitting its highest daily close since October 2024. This move signifies a potential momentum shift and growing bullish sentiment in the market,' stated Sudeep Shah, Head of Technical Research and Derivatives at SBI Securities.

Shriram Finance, Jio Financial Services, and Bajaj Finance led gains among index constituents, while Dr Reddy's and Tech Mahindra emerged as laggards. Sector-wise, Nifty Metal, Nifty Oil & Gas, and Nifty Financial Services outshone others, whereas Nifty Media and Nifty Realty ended in the red.

Broad markets, however, showed less vigor, with Nifty Midcap 100 and Nifty Smallcap 100 exhibiting modest activity, indicating selective market participation. Additionally, the Advance/Decline ratio remained unchanged, suggesting the surge wasn't broadly based across the market.

Market observers noted the Nifty's breakout from its 31-day consolidation range on the June monthly expiry day, marked by a large bullish candle on the daily chart, which reinforced the breakout's strength. The daily Relative Strength Index (RSI) breaking out of a Symmetrical Triangle pattern suggests a robust increase in bullish momentum.

'The market texture for intraday is bullish, though range-bound activity could be expected due to temporary overbought conditions. Day traders should consider buying on intraday corrections and selling on rallies,' advised Shrikant Chouhan, Head of Equity Research at Kotak Securities, highlighting investor confidence supported by Middle East ceasefire stability.

Financial analysts pointed out that Foreign Institutional Investors (FIIs) continued reducing holdings due to narrowing yield spreads between US and Indian 10-year bonds, while Domestic Institutional Investors (DIIs) stepped up as net buyers, encouraged by better liquidity and a domestic consumption rebound.

(With inputs from agencies.)