Benchmark stock markets started the new financial year on a positive note, as key indices closed significantly higher in a widespread surge on Tuesday. This uptrend was driven by improving global trends and a noticeable shift towards cyclical equities.
The BSE Sensex surged by 1,186.77 points or 1.65%, settling at 73,134.32. Similarly, the Nifty 50 climbed by 348 points or 1.56%, ending the day at 22,679.40, comfortably above the 22,600 level.
The market rally was inclusive, with mid- and small-cap stocks surpassing large-caps, indicating a growing risk appetite. Sectors such as banking, metals, chemicals, and real estate stood out as top performers, leading the gains in cyclical stocks, while defensive sectors lagged behind.
InterGlobe Aviation notably rose by approximately 6%, emerging as a top performer during the trading session. This increase was supported by easing concerns regarding aviation fuel costs and a positive demand outlook in the aviation sector.
Vinod Nair, Geojit Investments Limited’s Head of Research, highlighted that the markets commenced the fiscal year 2027 on a solid footing, benefiting from positive global sentiment. He mentioned that investor confidence was boosted by remarks made by Donald Trump suggesting a potential resolution to the West Asia conflict.
Nair also pointed out that a stabilizing rupee and declining crude oil prices further bolstered the market rally. The rotation of investments into cyclical sectors reflected expectations of enhanced economic activity. However, he cautioned that high bond yields and intraday fluctuations capped the market gains, preventing a more pronounced upward movement.
Despite the optimistic tone, Nair warned of market sensitivity to geopolitical events, indicating that sudden changes could reintroduce volatility in the short term.