Indian stock markets staged a strong recovery on Monday, October 26, snapping a four-day losing streak as buying in pharmaceutical, metal, healthcare and select technology stocks lifted benchmark indices. The rebound helped investors recover some of the losses suffered in recent sessions, although concerns about expensive crude oil, foreign fund outflows and global economic uncertainty continued to influence sentiment.
The BSE Sensex closed at 73,606.75, gaining 482.92 points, or 0.66%. The NSE Nifty 50 advanced 153.20 points, or 0.68%, to settle at 22,753.20, moving back above the 22,750 mark. Both indices recovered sharply from their early-session lows as investors stepped in to buy selected stocks following the recent correction.
Dr Reddy’s Laboratories and JSW Steel emerged among the leading Nifty 50 gainers, while BSE Limited, Max Healthcare and Eternal also featured among the stocks that supported the recovery. On the losing side, Shriram Finance and Tata Consumer Products were the biggest laggards, with HDFC Life, Bajaj Finance and HDFC Bank also ending lower. The contrasting performance showed that the market rebound was selective rather than uniform.
Dr Reddy’s Laboratories rose around 6.8% to Rs 1,313.30, emerging as the top Nifty gainer in the session. BSE Limited climbed 4.5% to Rs 3,376.30, while JSW Steel advanced around 4.1% to Rs 1,233.60. Max Healthcare and Eternal also recorded gains. The strength in pharmaceutical and metal shares helped offset weakness in several consumer and financial stocks.
Shriram Finance fell 4.62% to Rs 825, making it the biggest Nifty loser. Tata Consumer Products declined 2.84% to Rs 936.50, while HDFC Life Insurance slipped 1.64%. Bajaj Finance dropped 1.10%, and HDFC Bank also ended lower. Shriram Finance faced pressure after concerns about its loan growth outlook and credit costs weighed on investor confidence.
Technology stocks formed part of the broader recovery, although the sector’s performance was more measured than that of pharmaceuticals and metals. Information technology shares remain closely linked to global corporate spending, particularly investment in cloud computing, data centres and artificial intelligence infrastructure. Investors are assessing whether rising technology expenditure will translate into sustainable revenue growth for service providers and technology companies.
Artificial intelligence investment has become an important theme for global markets. According to UBS Global Research estimates reported in market coverage, six major hyperscalers are expected to invest around $7.7 trillion between 2026 and 2030. About $6.8 trillion of this amount would represent additional spending above their pre-AI capital expenditure run rate. To earn a 15% return on invested capital by 2031, these companies would need to generate approximately $1 trillion in additional earnings before interest and taxes.
The scale of this spending could create opportunities for businesses involved in computing infrastructure, networking, cloud services and related technologies. However, investors are also questioning whether the expected returns will justify the enormous investment. The ability of technology companies to monetise AI services and improve productivity will remain important to valuations across the sector.
Broader markets also participated in Monday’s recovery. The Nifty Midcap index gained around 1.2%, while the Smallcap index advanced 1.4%, outperforming the headline benchmarks. Market breadth was positive, with 2,262 shares advancing, 1,895 declining and 186 remaining unchanged on the exchanges covered in the market report. The gains suggested that buying extended beyond a small group of large-cap stocks.
Sectorally, pharmaceuticals, metals, healthcare, cement and oil and gas shares led the advance. Infrastructure, IT, private banking and energy stocks also recorded gains. FMCG, media and consumer durables were among the sectors that ended lower. The Nifty Metal index was among the strongest performers, reflecting renewed buying interest in industrial and commodity-linked shares.
External factors remain a concern for investors. The rupee weakened for a third consecutive session, closing at 95.1850 against the US dollar, down around 0.3%. Elevated crude oil prices and foreign investor selling have added pressure to the currency. A weaker rupee can raise the cost of imported fuel and raw materials, while higher oil prices can complicate India’s inflation outlook.
Global markets are also watching the US Federal Reserve’s upcoming policy decision and developments in geopolitical tensions. These factors could influence dollar demand, bond yields and foreign investment flows into emerging markets. For Indian technology companies, global economic conditions are particularly important because overseas clients account for a substantial share of demand for IT services.
Monday’s gains offered some relief after four difficult sessions, but investors will look for confirmation that the recovery can continue. Corporate earnings, crude oil prices, foreign portfolio flows and global technology spending are likely to remain key market drivers. The next phase will depend on whether buying broadens across sectors and confidence improves enough to sustain the rebound.