Nifty Breaks 22,800, Sensex Up 1,000 Points: 3 Reasons Behind Stock Market Surge

Nifty, Sensex today: Benchmark indices— Sensex and Nifty—witnessed a robust rally on Tuesday as D-street sentiment turned positive owing to favourable macros. BSE Sensex surged by over 1,130 points or 1.53%, to conclude the trading session at 75,301 level mark. NSE Nifty surpassed the key 22,800 level mark, surging by over 325 points or 1.45%.

From the Sensex pack, nearly all stocks were trading in red except Reliance, Tech Mahindra, Bharti Airtel and Bajaj Finserv.

Zomato came out on top as the stock witnessed a surge of over 7.4% on the National Stock Exchange. Sectorally, Nifty Auto was the top-performing index, experiencing an increase of nearly 500 points or 2.3%. Nifty Infra was the worst-performing sector.

So far this month, the performance of the domestic equity market has been robust with benchmarks surging by over 3%. Here's what pushing the markets up:

1. The China Factor

Nearly all Asian markets were trading in green earlier this week. On top of this, the Chinese government announced additional stimulus plans to reverse the slowdown and push domestic consumption levels.

"The national benchmarks witnessed a strong recovery, driven by favourable global trends and domestic tailwinds. Improved retail sales data from the US and China boosted investor confidence, while mid-cap and small-cap stocks outperformed, with all major sectors registering gains. The anticipated rebound in domestic earnings, along with a recent decline in the dollar index and lower crude prices, is expected to support this recovery," said Vinod Nair, head of research, Geojit Financial Services

2. US Markets

The US retail sales data indicated a rebound, surging by 0.2% after witnessing a decline of 0.9% in the previous month.

After briefly falling into correction territory, US markets made a strong comeback on Wall Street. The recent sales data helped ease investor concerns around a potential recession, eventually boosting confidence in the market.

3. Declining Dollar Index

The overall outlook for the US Dollar Index remained bearish, contributing to the strengthening of the Indian Rupee. In recent weeks, the Rupee recorded its longest winning streak.

However, the risk for India's market continues to loom. "However, continued FII outflows, driven by higher risk-free rates and the appeal of markets like China—along with tariff uncertainties, keep investors cautious during this phase," Nair added.