Why Sensex Jumped 800 Points? 3 Factors Driving Markets Higher

The Indian stock market traded sharply higher on Wednesday morning, with benchmark indices Sensex and Nifty gaining nearly 1% even as crude oil prices climbed amid rising tensions between the US and Iran.

At 9:49 am, the BSE Sensex was up more than 800 points at around 77,550. The NSE Nifty 50 gained over 200 points to trade above the 24,200 mark. At 12:09 pm, the Sensex was up 1.14%, while the Nifty 50 was up 1.07% at the same time.

The early rally added nearly ₹3 lakh crore to the market value of companies listed on the Bombay Stock Exchange (BSE). Total market capitalisation rose to about ₹482 lakh crore. The gains were broad-based. The Nifty Midcap 100 and Nifty Smallcap 100 indices advanced as much as 0.6% in intraday deals, indicating buying interest beyond large-cap stocks. Read on to know why is the stock market up today.

Why Stock Market Is Up Today?

Here are three reasons as to why the Indian stock market is up today:

1. IT Stocks Gain As India Holds Up Better Than Global Peers

Information technology (IT) stocks such as Infosys and HCLTech were among the biggest gainers. The move came even as several Asian markets with heavy exposure to semiconductor and artificial intelligence-related companies fell sharply. South Korea's Kospi declined about 9%, Japan's Nikkei slipped more than 4%, while Taiwan's benchmark index also dropped over 4%.

Market experts said India has relatively fewer large listed companies directly linked to the global AI infrastructure theme. That has helped domestic equities remain resilient as investors reassess whether heavy AI spending by global technology companies will deliver expected returns.

2. Rupee Strengthens, FII Buying Supports Sentiment

Another reason for the stock market’s rise today was continued support from foreign investors and a stronger rupee. Foreign institutional investors (FIIs) also turned net buyers on Tuesday. According to provisional NSE data, they purchased equities worth ₹755 crore after selling heavily during the previous four trading sessions.

Although the buying was modest compared with recent outflows, it helped improve market sentiment. Also, the Indian currency appreciated 12 paise to 95.70 against the US dollar in early trade. Traders attributed the rupee's resilience over the past three sessions to likely intervention by the Reserve Bank of India (RBI).

3. Fed Decision In Focus

Investors are also closely tracking the outcome of the US Federal Reserve's policy meeting due later in the day.

Markets broadly expect the central bank to leave interest rates unchanged. However, inflation remains a concern, making the Fed's commentary equally important. Market experts said expectations of a status quo on rates have supported risk appetite globally, even as investors remain cautious over geopolitical tensions and higher crude oil prices.

Analysts Watch Crude, Monsoon And FII Flows

Market experts said the recent range-bound movement in Indian equities could eventually give way to an upward move, supported by fairly valued Nifty stocks. They added that sustained foreign buying would depend on greater clarity over crude oil prices and the progress of the monsoon.

Experts also said the sharp correction in South Korean chip stocks could work in India's favour by making domestic equities relatively more attractive. According to market participants, any surprise rate hike by the US Federal Reserve could weigh on emerging markets, as higher US bond yields may divert foreign investment away from equities, including India.

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