Investors gain ₹20 lakh crore in three sessions as Sensex rallies 3,000 pts; Nifty nears 24,000

Indian equity markets extended their winning streak for a third straight session on Tuesday, with benchmark indices Sensex and Nifty closing at their highest levels this month amid easing geopolitical concerns, softer crude oil prices and sustained buying across key sectors such as IT, FMCG, realty and financials.

The BSE Sensex ended 544 points, or 0.71%, higher at 76,808.48, while the Nifty 50 gained 135 points, or 0.57%, to close at 23,989.15.

The sustained rally has significantly boosted investor wealth, with the Sensex surging 2,975 points, or nearly 4%, over the last three trading sessions. During the same period, the Nifty has climbed 827 points, or 3.57%.

Investor wealth swelled sharply as the total market capitalisation of BSE-listed companies rose by nearly ₹20 lakh crore to ₹472.26 lakh crore from ₹451.83 lakh crore on June 11.

The rally was broad-based, with the Nifty Midcap 100 and Nifty Smallcap 100 indices gaining around 0.4% each.

Market volatility also eased considerably, with India VIX declining nearly 7% to 13.36, as investors continued to respond positively to the formal US-Iran peace agreement and the planned reopening of the Strait of Hormuz.

IT, FMCG, realty leads gain

Among Sensex constituents, HCLTech emerged as the top gainer, rising 3.6%, followed by Bajaj Finserv, NTPC, Hindustan Unilever and TCS, which gained between 1.7% and 2.1%. Reliance Industries, Bajaj Finance, Tech Mahindra, ITC and Titan also contributed to the market's advance. On the downside, IndiGo, UltraTech Cement, Maruti Suzuki, Tata Steel, BEL and SBI were among the notable laggards.

Sectorally, IT stocks led the rally, with the Nifty IT index advancing 1.8%, supported by gains in HCLTech, TCS and Infosys. Realty stocks also witnessed strong buying interest, with the Nifty Realty index climbing 2.3%. FMCG, consumer durables, media, oil & gas and financial services indices also ended in positive territory.

In contrast, metal stocks remained under pressure, with the Nifty Metal index falling 1.6% amid a sharp correction in global aluminium and base metal prices following signs of easing supply disruptions in the Middle East.

De-escalation of West Asia tensions, lower crude prices boost sentiment

According to Vinod Nair, Head of Research at Geojit Investments Limited, domestic equities continued to benefit from growing optimism surrounding a possible de-escalation of tensions between the US and Iran, coupled with declining crude oil prices.

"Domestic equity markets continued their recovery momentum, buoyed by growing optimism around a de-escalation in US-Iran tensions and softening crude oil prices. The rally was broad-based, with notable gains in IT, realty, FMCG and oil & gas sectors. Metal stocks, however, lagged behind, weighed down by a sharp pullback in global metal prices as supply-side concerns began to subside," he said.

Nair added that investors remain cautious ahead of the upcoming US Federal Reserve policy meeting, where the central bank is widely expected to keep interest rates unchanged. However, market participants will closely monitor the Fed's commentary for clues on the future path of monetary policy.

Technical market structure remains positive

From a technical standpoint, analysts believe the market structure remains positive. Aakash Shah, Research Analyst at Choice Equity Broking, said the Sensex continues to trade above its key 50-day and 100-day exponential moving averages, indicating that the broader uptrend remains intact despite intermittent bouts of consolidation.

"The index continues to trade above its 50-day and 100-day EMAs, suggesting that the broader trend remains constructive despite short-term consolidation. Momentum indicators are relatively stable, with the RSI at 60.51, indicating healthy strength and scope for further upside if buying momentum improves," Shah said.

He added that immediate resistance for the Sensex is seen around the 77,300-77,400 zone, while the 76,300-76,400 range is expected to provide strong support in the near term.

Looking ahead, market participants are likely to remain focused on developments related to the proposed US-Iran agreement and the outcome of the Federal Reserve's policy meeting. According to Ponmudi R, CEO of Enrich Money, while easing geopolitical tensions have improved sentiment, the sustainability of the rally will depend on the successful implementation of the peace framework and further normalisation in energy markets.

"While the easing of geopolitical tensions has improved sentiment, a durable recovery will depend on the successful execution of the peace framework and a sustained normalisation of energy markets, supported by the continued reopening of the Strait of Hormuz and the restoration of oil flows," he said.

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