The benchmark equity indices extended their gains for the third consecutive session on Thursday, with the Sensex and Nifty rising over 1 percent, supported by positive global cues and easing geopolitical tensions.
Sensex jumped 1,000.36 points or 1.21 percent to settle at 83,755.87. During the day, it surged 1,056.58 points or 1.27 percent to 83,812.09, while the Nifty rallied 304.25 points or 1.21 per cent to 25,549.
Major gainers included Bharat Electronics, Tata Steel, Eternal, Bharti Airtel, Bajaj Finance and Adani Ports.
Key factors driving the market rally:
1) US-Iran talks: Markets remained buoyant following signs of de-escalation in tensions between Iran and Israel. US President Donald Trump, speaking at a NATO summit in The Hague on Wednesday, said talks with Iran were likely next week and hinted at the possibility of a new agreement aimed at halting Iran’s nuclear ambitions.
"With the ceasefire between Israel and Iran, global markets are in risk-on mode. However, the unresolved reciprocal tariff issue may cap the upside. Markets will be closely watching developments around July 9, when the 90-day pause on the tariff deal ends," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
2) Firm global cues: Asian markets were largely higher, with Japan’s Nikkei 225 and China’s Shanghai Composite trading in the green. US markets ended mixed overnight, but Futures indicated a positive opening for the US markets.
3) Strengthening rupee: The rupee appreciated by 21 paise to 85.87 against the US dollar in early trade, tracking weakness in the greenback globally. A stronger rupee is generally seen as positive for equities, as it helps ease import-related cost pressures and supports foreign investor sentiment. However, gains were limited due to rising crude oil prices and persistent FII outflows, traders said.
4) Domestic economic resilience: The Reserve Bank of India, in its June bulletin, said various high-frequency indicators suggest resilient activity across India's industrial and services sectors, despite global headwinds. "Global economic conditions remain volatile due to trade policy uncertainty and geopolitical risks. Yet, India’s macroeconomic fundamentals continue to show strength," the bulletin noted.
5) Buying in heavyweights: Shares of Bharti Airtel, Reliance rose up to 2 percent. Buying in these large-cap stocks contributed to index gains and lifted overall market sentiment.
6) Nifty Bank hits record high: Nifty Bank hit the fresh record high on Thursday to hit a new 52-week high of 57,076.95, led by private sector banks doing the heavy lifting. HDFC Bank was top gainer, hitting a fresh high. Bank Nifty is up 12 percent in 2025 so far.
Technical view
Anand James, Chief Market Strategist at Geojit Financial Services, said while the broader outlook for Nifty remains positive, caution is warranted due to lack of strong momentum.
"If the index sees a dip, it may find support in the 25,173–25,127 region. Further downside may be seen around 25,014–24,940. On the upside, consolidation may occur near 25,330, with a potential move towards 25,460–25,550," he said.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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