Sensex settles 300 pts higher, Nifty closes near 25,300: FII buying among key factors behind market rise

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Indian benchmark indices rose on October 10, extending gains for the second consecutive session amid broad-based buying barring metal and IT. Sensex rose more than 328 points (0.4 percent) to close at 82,500.82. Nifty 50, meanwhile, gained over 103 points (0.41 percent) to end the session at 25,285.35.

The benchmarks indices have closed the weak on a positive note, recording the best weekly performance in around three months. Sensex gained more than 1,253 points (1.6 percent), while Nifty 50 rose over 391 points (nearly 1.6 percent) during the week.

Notably, Nifty 50 had crossed the 25,300-mark during the day, marking the first time since September 22 this year.

Among the sectors, real estate stocks led gains, while metal stocks tumbled the most. The broader markets mirrored the uptrend in the benchmarks, trading in the deep green in the morning trading hours.

Here are the key factors pushing the stock markets higher up today:

In-line TCS results:

Tata Consultancy Services (TCS) announced its earnings for the second quarter of the financial year 2026 in the post market hours of October 9. The firm's consolidated net profit rose 1.4 percent year-on-year to Rs 12,075 crore, while revenue from operations rose to Rs 65,799 crore.

The results were in-line with some analysts' expectations. "TCS reported revenue of $7.5 billion in Q2FY26, up 0.8% QoQ in CC terms vs. our estimate of 1%. What stood out, however, was its foray into colocation data centers in India. While management expects FY26 growth to be better than FY25, we believe this guidance is somewhat fuzzy. Regarding the data center announcement, we await clarity on the capital structure, capex schedule, and other details such as potential rentals and signed MOUs. At present, we do not model data center investments or related revenue into our forecasts. Valuations are undemanding, and we reiterate our BUY rating on TCS with a target price of Rs 3,500, implying a 15% potential upside," said Motilal Oswal Financial Services.

TCS kickstarted the earnings season for the IT pack, as well as the Nifty 50 companies. The in-line results may have boosted investor sentiment. While TCS shares were down in the red with marginal losses, its peers Wipro and Infosys were up nearly 1 percent each.

"The broader market sentiment remains upbeat on optimism around demand recovery and expectations of steady quarterly earnings," Vikram Kasat, head of advisory at PL Capital told Reuters.

Liquidity returns to market:

The primary markets are currently seeing huge inflows from IPOs. The Rs 15,512-crore initial public offering of Tata Capital, the largest in Indian markets in 2025 so far, closed for public bidding day before yesterday, and the allotments have now been finalized. The refunds are likely to be processed today, bringing back strong liquidity to the market.

The IPO of LG Electronics India closed yesterday, after being oversubscribed 54 times. After the allotments are announced today, the non-allotted shareholders will receive their refunds, which is expected to bring some more inflows into the stock markets.

"A significant market trend is the elevated enthusiasm in the primary market. The Rs 11,607-crore LG Electronics IPO getting oversubscribed 54 times is the reflection of exuberance in the IPO market. Refunds from these and other IPOs will add to the liquidity in the market helping the market to move higher," said VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.

Trump-Modi review 'good progress' in trade negotiations:

Prime Minister Narendra Modi on October 9 said that he spoke to US President Donald Trump over the phone call, and "reviewed good progress achieved in trade negotiations".

Any move hinting at a possible trade truce between the two countries will likely have a positive impact on the markets, after Trump earlier increased import tariffs on Indian goods to a whopping 50 percent.

Additionally,  US Treasury Secretary Scott Bessent said that India is set to buy less Russian oil and more US oil in the coming time.

FII buying:

On October 9, Foreign Institutional Investors (FII) remained net buyers for the third consecutive session. This persistent buying by the foreign investors may have also led to the uptrend in the stock markets.

"The overall market environment is turning positive. Globally, the GAZA peace accord signals end to the conflict and reduction of geopolitical risk from the region. Domestically, there are indications of a trade deal between US and India with India ‘rebalancing’ its oil purchases. These positive developments and the shift in FII strategy (FIIs were buyers in the cash market in the last three trading days) bode well for the market. Even though valuations continue to be relatively high compared to most other markets, short-covering can take the market higher. This is a highly probable event since the short position in the market continues to be high,” said Vijayakumar.

Buying in bank stocks:

Bank Nifty crossed the psychologically important level of 56,500 on October 10, which analysts said could propel the sectoral index to the level of 57,300-57,600.

Reserve Bank of India's latest monetary policy unveiling various measures, including the relaxation of rules for lending to large corporate groups, and strong Q2 business updates from leading banks like HDFC Bank and Kotak Mahindra Bank are likely boosting the bank stocks since October 1.

The Nifty Bank index rose more than 0.6 percent to 56,547.60, with almost all constituent stocks trading in the green. Punjab National Bank (PNB), State Bank of India (SBI), Axis Bank and Canara Bank shares were the top gainers on the index, rising more than 1 percent each.

The index has now extended gains for the second consecutive session. Choice Broking had suggested that a breakout above the resistance level of 56,500–56,600 levels was necessary to maintain the positive bias.

The Nifty PSU Bank index also recorded strong gains, rising nearly 0.8 percent to 7,627.30.

What lies ahead?

As long as Nifty 50 remains above 25,000 and Sensex above 81,700, the uptrend is likely to continue, said Shrikant Chouhan, Head Equity Research, Kotak Securities. “A successful breakout above 25,250/82300 could push the market towards 25,350-25500/82900-83200. On the other hand, below 25,000/81700, the uptrend would become vulnerable,” he added.

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