Stock markets continued their upward movement on Thursday, with both Sensex and Nifty extending their gains ahead of Diwali. The rally was supported by multiple factors as investor sentiment improved on hopes of a possible trade deal between India and the US.
By 2:33 pm, the S&P BSE Sensex had climbed 885.28 points to 83,490.71, while the NSE Nifty50 gained 265.25 points to 25,588.80, marking a rise of over 1%.
“Today the Asian markets are also positive, and the domestic liquidity is strong. DIIs have been net buyers and ahead of the festive season, people are accumulating the stocks,” said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
RUPEE STRENGTHENS AGAINST THE DOLLAR
The Indian rupee rose to a one-month high on Thursday, supported by optimism surrounding trade talks between India and the United States. The currency touched 87.70 in early trade before settling at 87.87, up 0.2% for the day.
According to traders, the Reserve Bank of India (RBI) played a key role in supporting the rupee. Reports suggest the central bank sold between $3 billion and $5 billion in spot and forward markets on Wednesday – one of its largest interventions in recent months. This move was aimed at curbing speculation and discouraging short positions on the rupee.
Market sentiment improved after US President Donald Trump said Indian Prime Minister Narendra Modi had agreed to stop buying oil from Russia. The comment led traders to believe that trade frictions between the two countries may ease soon. Trump had earlier imposed a 25% tariff on Indian goods under the so-called reciprocal tariffs and targeted India for its Russian oil purchases.
The Indian government, meanwhile, confirmed that discussions were underway with the US to strengthen energy cooperation, which helped boost investor confidence and supported the rupee’s rise.
GOLD AND SILVER CONTINUE TO RALLY
Gold and silver prices hit record levels on Thursday as global investors turned to safe-haven assets amid economic and geopolitical uncertainty. Spot gold climbed 0.4% to $4,224.79 per ounce after reaching an all-time high of $4,225.69. Silver prices also rose 0.2% to $53.16 per ounce, just below the record high of $53.60 seen on Tuesday.
The rally in precious metals was driven by expectations of interest rate cuts by the US Federal Reserve, strong demand from central banks, and growing concerns about global trade and inflation. A weaker dollar also made gold more attractive to foreign investors.
US gold futures for December delivery rose 0.9% to $4,239.70, while holdings in the SPDR Gold Trust – the world’s largest gold-backed exchange-traded fund – rose 0.11% to 1,022.60 tonnes on Wednesday. Platinum gained 0.7% to $1,665.70, while palladium edged down 0.3% to $1,540.36.
Analysts say investors expect a 25-basis-point rate cut at this month’s Federal Reserve meeting, followed by another in December, which could further support gold prices.
BROAD MARKET RALLY WITH STRONG EARNINGS
Apart from global cues, the Indian stock market was lifted by a broad-based rally across sectors. Midcap and smallcap indices also joined the rise. The Nifty Midcap 100 index climbed 0.54%, and the Nifty Smallcap 100 gained 0.15%.
Sectoral performance showed strong buying in key areas. Nifty Auto led with a gain of 1.23%, followed by Nifty FMCG, which rose 1.59%, and Nifty Private Bank, which was up 1.32%. Nifty Realty surged 1.82%, while Nifty Financial Services, Consumer Durables, and Metal indices also posted steady gains.
Nifty IT edged up 0.11%, Pharma rose 0.10%, and PSU Bank added 0.05%. The Nifty Media index gained 0.69%, and Nifty Oil and Gas was up 0.29%.
Market experts said the rally was supported by healthy Q2 earnings from several companies, which have improved investor sentiment after a volatile September. The India VIX, a measure of market volatility, rose 2.11%, showing that traders expect some movement ahead but remain largely optimistic.
Overall, a mix of global and domestic factors – a stronger rupee, gold rally, and broad-based earnings-driven optimism – helped lift investor mood on Thursday, keeping the market firmly in the green.