Indian equity markets staged a strong recovery on Thursday, with the BSE Sensex soaring more than 650 points and the Nifty 50 posting solid gains despite ongoing geopolitical tensions between Iran and the United States and a rise in global crude oil prices.
The rebound came after benchmark indices declined nearly 2% in the previous trading session, as investors returned to the market amid improving sentiment and attractive valuations.
Easing India VIX Boosts Confidence
One of the key factors behind the rally was a sharp decline in the India VIX, the market’s volatility index, which fell nearly 9%. A lower VIX generally indicates reduced investor anxiety and improved confidence, encouraging buying across sectors.
Value Buying Supports Market Recovery
Market experts attributed the rally to value buying after recent corrections. Many fundamentally strong stocks became available at more attractive valuations, prompting investors to accumulate quality shares. Analysts noted that while geopolitical risks remain, the market has not priced in a worst-case scenario, as crude oil futures continue to indicate expectations of manageable supply disruptions.
Continued FII and DII Buying
Foreign Institutional Investors (FIIs) remained net buyers for the fourth consecutive trading session, purchasing Indian equities worth nearly ₹1,963 crore. Domestic Institutional Investors (DIIs) also returned as net buyers, investing around ₹790 crore, providing additional support to the market’s upward momentum.
The broader market outperformed the benchmark indices, with both the Nifty Midcap 100 and Nifty Smallcap 100 registering gains of more than 1%. Banking and FMCG stocks emerged as the top-performing sectors, while information technology stocks remained under pressure during the session.
Despite concerns over rising crude oil prices and developments in the Middle East, investors appeared focused on India’s strong domestic fundamentals, steady institutional inflows, and improved market sentiment, helping benchmark indices extend their gains.