The Indian stock market surged for the fourth consecutive session on Thursday, powered by strong foreign institutional investor (FII) buying, easing US tariff concerns, and growing expectations of an early interest rate cut by the Federal Reserve. Major indices touched fresh nine-month highs as heavyweight stocks led the rally.
The Nifty 50 jumped 304.25 points, or 1.21 percent, to close at 25,549, while the Sensex surged 1,000.36 points, or 1.21 percent, to end at 83,755.87. The Bank Nifty rose 1.03 percent to 57,206.70. However, the broader market lagged, with the Nifty Midcap 100 up just 0.59 percent and the Smallcap 100 advancing 0.42 percent.
Foreign investors turned net buyers after weeks of cautious selling, picking up ₹12,594 crore worth of shares on Thursday. In contrast, domestic institutions offloaded stocks worth ₹195 crore. Eighteen stocks on the Nifty 50 gained over 1.5 percent, with nine of them climbing more than 2 percent.
Heavyweights such as HDFC Bank (up 2.2 percent) and Reliance Industries (up 1.9 percent) were among the top gainers. Reliance’s market capitalisation crossed ₹20 lakh crore, a level last seen in September 2024.
However, the midcap and smallcap segments showed signs of fatigue, with valuation concerns resurfacing. Market veterans noted that many such stocks are trading at unsustainably high P/E multiples, raising red flags about long-term investment potential.
The overall advance-decline ratio remained in favour of gainers, but was relatively weak. On the BSE, 2,097 stocks rose while 1,900 declined. On the NSE, 1,474 shares advanced versus 1,391 that declined. Seventy-seven stocks hit upper circuits, while 58 fell to lower circuits.
Analysts expect the Nifty to inch towards the 26,000 mark in the coming sessions, although some resistance is anticipated around the 25,650 level. Support is seen at 25,345 and 25,265.
Globally, investor sentiment turned bullish after signs emerged of the US softening its stance on tariffs. White House officials hinted at deferring additional levies on non-trade-deal countries, including India, beyond the July 8 deadline set by Donald Trump. An Indian delegation is currently in Washington for trade talks.
Reports also surfaced that Trump is actively seeking to replace Federal Reserve chair Jerome Powell ahead of the May 2026 retirement, with a successor announcement likely in the coming months. Markets interpreted this as a signal that a more dovish Fed leadership may be installed, potentially hastening rate cuts.
US markets rallied on Thursday, buoyed by these developments. The Dow Jones surged 404.41 points (0.94 percent) to close at 43,386.84, while the S&P 500 rose 48.86 points (0.80 percent) to 6,141.02. The Nasdaq gained 194.36 points (0.97 percent) to finish at 20,167.91. The S&P 500 closed at a record high, although its intraday peak remained just above the closing level.
US GDP data for the January–March quarter was revised down to a 0.5 percent contraction from the previous estimate of 0.2 percent, reflecting weaker consumer spending and increased pre-tariff imports. Weekly jobless claims rose by 236,000, lower than the projected 244,000.
US futures were mildly positive early Friday, with the Dow, S&P 500, and Nasdaq up by 0.12 percent, 0.04 percent, and 0.02 percent, respectively. Asian markets tracked the US rally. Japan’s Nikkei rose 1.5 percent, while South Korea’s Kospi was flat. Chinese and Hong Kong indices posted modest gains.
A notable acquisition in Japan saw Taiwanese firm Carux purchase audio systems maker Pioneer for $1.1 billion.
Gold prices swung sharply on Thursday, as Fed speculation and weak GDP data pushed yields lower. Spot gold moved between $3,008 and $3,051 per ounce, before closing at $3,021.80. On Friday morning, it eased to $3,019. In Kerala, gold prices held steady at ₹72,560 per sovereign. Silver edged up to $36.56 per ounce.
Crude oil rose slightly due to a weaker dollar. Brent traded at $68.08 a barrel, WTI at $65.58, and Murban crude at $68.32. Natural gas, however, dropped by over 4 percent.
In currency markets, the US dollar initially weakened but recovered slightly by Friday morning. The dollar index slipped to 97.15 on Thursday but rebounded to 97.39. The euro strengthened to $1.1692 and the pound to $1.373. The Japanese yen appreciated to 144.67 per dollar.
The Indian rupee strengthened 37 paise to close at 85.71 against the dollar. China’s yuan rose to 7.17 per dollar. Meanwhile, US 10-year Treasury yields fell to 4.257 percent.
Cryptocurrencies saw a mild dip. Bitcoin slipped to $107,100, while Ethereum fell below $2,425.
