Diwali cheer on D-St! Nifty reclaims 25,000 as rally extends to 7th session; investors add over Rs 30 lakh crore

Indian equity markets extended their rally for a seventh consecutive session on Friday, with domestic benchmarks soaring more than 2 per cent each, adding to the festive cheer on Dalal Street ahead of Diwali. Domestic indices emerged as a relative bright spot in Asia, even as other regional markets came under pressure amid renewed concerns over artificial intelligence (AI)-related investments.

The weakness across other Asian markets followed an overnight sell-off on Wall Street, led by technology stocks, amid worries over a potential slowdown in AI investments and data centre spending.

The concerns came amid setbacks for the Donald Trump-led Republicans in the US mid-term elections, with Democrats making gains. The developments have brought renewed attention to the outlook for investments in AI and technology infrastructure.

The weakness in global technology stocks has also brought the so-called 'anti-AI trade' into focus.

The 30-share BSE Sensex pack rallied 1,718.01 points or 2.17 per cent to close at 81,028.02. With Friday's gains, the index has advanced 7,781.99 points over the past seven trading sessions.

The NSE Nifty index climbed 493.75 points or 2.01 per cent to settle at 25,030.35. With this, the index has gained 2,331.5 points during the same period.

The sustained rally also lifted investor wealth. The total market capitalisation (m-cap) of BSE-listed companies increased by around Rs 1.49 lakh crore to Rs 503.10 lakh crore, compared with Rs 501.61 lakh crore in the previous session.

Over the last seven trading sessions, notional investor wealth has increased by Rs 30.41 lakh crore.

Vinod Nair, Head of Research at Geojit Investments, said, "Indian equities defied a global rout, extending their winning run as investors treated the home market as a relative safe harbour amid turmoil abroad. Wall Street was hammered by a sharp tech sell-off as investors weighed the prospect of tougher regulation under Democrats. Large private banks emerged as the prime beneficiaries, their deep liquidity and attractive valuations making them a natural home for this rotational money."

Nair also said, "A sharp weekly slide in crude, easing US Treasury yields and a firmer rupee further burnished India's relative appeal."

Echoing a similar view, Ponmudi R, CEO of Enrich Money, said, "The Indian rupee also staged a sharp recovery, touching 93.80 against the US dollar, its strongest level in six months, supported by softer crude prices and the return of foreign portfolio inflows. The combination of renewed foreign buying, a firmer rupee and easing crude oil prices has strengthened the domestic market outlook."

He, however, noted that gains being concentrated in select large-cap stocks highlight the uneven nature of the recovery, warranting some caution.