Sensex rises 700 points, extends gains: Key factors behind the market rally 

Sensex and Nifty rose for the second straight session today after the US Supreme Court struck down import levies imposed by President Donald Trump. Sensex rose 672 points intra day to a high of 83,486 and Nifty gained 200 pts intra day to 25,771.

Auto stocks and pharma stocks gained on Monday amid a rally in the global markets. BSE auto index rose 285 pts to 62,052 and BSE pharma index gained 211 pts to 43,295.

Here's a look at key factors that led to the market rally today.

1. Supreme Court verdict on tariffs

US Supreme Court struck down import levies imposed by President Donald Trump last week. The ruling, which has significant implications for global trade and economy, gave bulls a reason to extend gains on the Dalal Street from the last session.  Acoording to analysts, investors were also tracking likely changes in trade terms between India and the US after the Supreme Court's decision

2. Value buying

Value buying in the Indian market took the stocks higher in the first session of this week. Investors lapped up shares such as Adani Ports, Kotak Bank, PowerGrid, Axis Bank, HUL, and Bharti Airtel among others. These were the top Sensex gainers, rising up to 2.44% in the afternoon session today.

3. Positive global cues 

Global markets were trading in the green, buoyed by the US Supreme Court's decision. Hong Seng surged 649 pts to 27,063 and Taiwan Weighted added 167 pts to 33,773. In the US, Nasdaq and S7P 500 surged up to 0.90% on Friday.

4. India VIX 

The India VIX index slipped 11% to 12.77, indicating a fall in volatility on Dalal Street. India VIX signals volatility in Indian markets.

5.  Technical levels

"The recent wild swings have helped form a flag pattern that projects a vertical rise shortly. However, should we stumble again in the 26200 vicinity, the upside hopes will have to be abandoned. We will go in today on a positive note, but expect upsides to strengthen only once past 25840. Alternatively, inability to float above 25700 could signal loss in upside momentum, but we will wait for a slippage past 25590 to switch sides," said Anand James, Chief Market Strategist, Geojit Investments Limited.

Throwing light on fundamentals, VK Vijayakumar, Chief Investment Strategist, Geojit Investments said, "India has already delayed the visit of its trade negotiating team to the US in the light of the changed scenario. This is welcome move.  From the market perspective, the US SC decision is indeed a positive, but this is not sufficient to trigger a sustained rally in the market. The market will see only a relief rally which is unlikely to sustain. The market will respond only to the fundamentals, which are fortunately improving."