Why is the stock market running? Sensex rises 1,500 points in 3 days, Nifty crosses 25 thousand

Stock market boom

The Indian stock market has seen a good increase since last Wednesday, the benchmark Sensex has increased by more than 1,500 points and the Nifty also crossed 25 thousand. On Monday, October 6, the Sensex rose 600 points or about 81,846 to the interdendent highest level, while the Nifty 50 also rose nearly by about one percent to 25,095.95. Let us understand why the Indian stock market is rising in the midst of global tension.

The Sensex rose 583 points or 0.72 percent to close at 81,790.12 on Monday, the first trading day of the week, while the Nifty rose 183 points or 0.74 percent to close at 25,077.65. The BSE Midcap index jumped 0.68 percent, but the smallcap index closed down 0.20 percent.

Why is the market running?

  1. Short covering bounce in the market- Experts say that recently the domestic stock market has seen improvement and short covering is taking place in quality stocks. With this, the benchmark index is reaching a high level. In recent times, the IT sector shares had declined drastically due to increase in H-1B visa fees and other regional troubles, but on Monday, they saw a good rise. The Nifty IT index rose more than 2% for the third consecutive day.
  2. Banking stocks also strengthened- The boom in banking shares has also supported the market. IT and banking shares have about 50% weightage in the Nifty index. The Nifty Bank Index has been increasing continuously from the last four sessions and it has increased by more than 3%. Due to no change in the policy rates of RBI and their soft trend, the pressure of margin on banking companies has reduced. In Mint’s report, Pankaj Pandey, research head of ICICI Securities, said that I think the policy of RBI has been very positive. Because of this, BFSI (Banking, Financial Services and Insurance) sector has started well. Also, short covering is being seen in the IT sector. Both these sectors consist of about 50% of the index, which is a major reason for the market boom.
  3. Relief from RBI policy- RBI’s monetary policy remained in accordance with expectations, which has given relief to the market. Estimates of favorable growth and low inflation, as well as the soft attitude of RBI Governor Sanjay Malhotra improved the market mood. RBI has increased India’s GDP growth estimate from 6.5% to 6.8% for FY 2026. At the same time, the estimate of inflation has been reduced from 3.1% to 2.6%.
  4. Valuation is correct, expected to boom in the market and According to Motilal Oswal, the government’s steps will help in bringing corporate income back on track. Domestic reforms are expected to continue. If any deadlock associated with tariffs ends, then it will be a big exterior trigger for the market. The brokerage firm says that we are seeing further boom in the market, especially when corporate income is increasing, interest rates are low, liquidity is sufficient and macro-economic improvement.

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