The equity markets staged a strong rally on Monday, with the Sensex gaining more than 650 points and the Nifty 50 crossing the 24,600 mark as falling crude oil prices, easing geopolitical concerns and broad-based buying lifted investor sentiment.
The rally came after US President Donald Trump indicated that talks with Iran could take place, raising hopes of reduced tensions in West Asia. The development triggered a sharp decline in crude oil prices, providing relief to oil-importing economies such as India. Brent crude fell around 5%, becoming one of the key drivers behind Monday’s gains in Indian equities.
Investors also took comfort from improving global signals and expectations of continued foreign institutional investor buying. The Indian rupee strengthened at the opening, rising 0.25% to ₹95.1450 against the US dollar from the previous close of ₹95.38.
Global markets were mixed. S&P 500 futures rose 0.5%, while Hong Kong’s Hang Seng gained 0.6%. Japan’s Topix, however, declined 2.2%, while the Shanghai Composite slipped 0.4%. Euro Stoxx 50 futures were up 0.6%.
The domestic market was also supported by encouraging June-quarter earnings and healthy economic indicators. Analysts noted that better-than-expected credit growth, strong auto sales, resilient earnings and stabilisation in the rupee were improving the outlook for Indian equities.
Geojit Investments Chief Investment Strategist VK Vijayakumar said falling Brent crude, a healthy monsoon and foreign investors turning buyers were positive triggers for the market. Another Geojit strategist, Anand James, identified 24,600 as an immediate hurdle for the Nifty, with 24,100 emerging as a key support zone.
Buying was visible across several sectors, with ITC emerging as one of the strongest Nifty 50 performers. ITC shares gained around 3.8%, touching an intraday high of ₹292.50. The buying came despite a decline in quarterly profit, with investors focusing on revenue growth and the company’s longer-term recovery prospects.
Shriram Finance was another major Nifty gainer, rising nearly 2.9%. Financial stocks remained strong as investors continued to favour banks and non-banking financial companies.
Bajaj Finserv also gained more than 2% after reporting a 12% year-on-year increase in consolidated net profit to ₹3,132 crore for the June quarter. Revenue increased 19%, prompting Motilal Oswal to upgrade the stock to ‘Buy’ and raise its target price to ₹2,490.
Among mid-cap stocks, Aditya Birla Capital gained more than 5%, while Godfrey Phillips, Jubilant FoodWorks, Paytm and LG Electronics were also among the notable gainers.
Sectoral performance reflected the broad nature of the market recovery. The Nifty FMCG index rose 1.80%, while Nifty PSU Bank gained 1.48%. Nifty IT advanced 1.36%, Nifty Financial Services rose 1%, and Nifty Bank gained 0.90%.
Metal, auto, realty, infrastructure and consumption stocks also traded higher. In contrast, the Nifty Media index declined 1.61%, making it the weakest sectoral performer.
The broader market also remained supportive, suggesting that Monday’s rally was not limited to a few heavyweight stocks.
Despite the strong market-wide rally, several stocks faced sharp selling pressure.
Zee Entertainment was among the biggest losers after shares plunged more than 10%. The decline followed Sebi’s decision to bar founder Subhash Chandra and CEO Punit Goenka from the securities market for one year in connection with an unauthorised property pledge case. The regulator also imposed penalties and flagged governance-related issues.
Muthoot Finance also witnessed heavy selling, falling more than 9% and emerging as the biggest loser on the Nifty Next 50. GAIL declined around 4.4%, while Thermax and Persistent Systems were among the notable mid-cap losers.
Within the Nifty 50, Sun Pharma fell around 1.2%, while Bharti Airtel, Maruti Suzuki, Bajaj Auto and NTPC also traded in the red. Maruti Suzuki’s shares slipped despite strong July sales, highlighting some profit booking in stocks that had already performed well.
Automobile stocks continued to attract attention following strong July sales numbers. Eicher Motors gained nearly 1.8% after total sales jumped 34% year-on-year to 1,18,232 units. Domestic sales increased 38.1%, while exports rose 10%.
Escorts Kubota also advanced after reporting a 22% increase in July tractor sales to 8,731 units, led by strong domestic demand.
Several companies also reported strong operational updates. Sterlite Technologies gained 5% after securing a ₹960-crore multi-year fibre cable supply agreement from a domestic telecom operator. HFCL rose around 5% after winning an international order worth ₹522.73 crore.
With the Sensex up more than 650 points and the Nifty holding above 24,600, investor sentiment has clearly improved. However, analysts expect some volatility as the benchmark approaches key resistance levels. The RBI‘s upcoming monetary policy decision, crude oil prices, foreign fund flows and the continuing Q1 earnings season will remain important triggers for the market in the days ahead.