CHENNAI: Indian equity markets ended Wednesday’s session on a firm footing, extending recent gains as broad-based buying lifted the benchmarks through the day and helped them settle near the day’s highs. Positive global cues, optimism around India’s trade engagement with the European Union and steady domestic institutional support combined to underpin sentiment, even as investors remained selective in stock picking.
The BSE Sensex rose nearly 500 points to close above the 82,300 mark, while the NSE Nifty 50 finished comfortably above 25,300, registering gains of around two-thirds of a percent. The advance was supported by strength across several heavyweight sectors, with metals, oil and gas, energy, media and select infrastructure stocks leading the move. Midcap and smallcap shares outperformed the frontline indices, reflecting a broadening of participation beyond a handful of large-cap names.
Market participants took comfort from the improving tone around India’s external trade prospects following progress on the India–EU free trade agreement, which is seen as supportive of export-oriented industries over the medium term. This positive backdrop encouraged risk-taking, particularly in cyclical sectors that stand to benefit from higher global demand and a more stable external environment.
"Selective buying was evident in export-oriented and manufacturing stocks, reflecting expectations of stronger external demand and improved trade linkages," said R Ponmudi, CEO at Enrich Money.
The rupee traded within a narrow range against the US dollar, drawing support from a softer dollar environment but remaining capped by month-end demand and cautious foreign flows, he added.
Metal stocks advanced on expectations of better pricing and improved demand outlook, while oil and gas counters gained as investors positioned for steady refining margins and strong domestic consumption. Media and energy stocks also saw sustained buying interest, aided by stock-specific triggers and improving earnings visibility. Financial stocks contributed to the upside, although gains were more measured compared to the broader market, with investors awaiting clearer cues on credit growth trends and asset quality.
The session was characterised by a steady upward bias rather than a sharp spike, suggesting accumulation at higher levels rather than short-covering-driven rallies. Intraday dips were met with buying, indicating that sentiment remains constructive despite the indices trading near record zones. Market breadth remained positive, with advances comfortably outnumbering declines, reinforcing the view that the rally has widened in scope.
On the macro front, a relatively stable rupee and easing volatility in global markets helped keep risk appetite intact. Investors also drew reassurance from the absence of any immediate negative surprises on the geopolitical or policy front, allowing domestic factors to take centre stage in driving prices.
That said, participants continue to tread with caution. Valuations across several pockets are stretched, and any adverse movement in global cues, crude oil prices or foreign fund flows could prompt bouts of profit-taking. The market’s ability to hold above key technical levels on the Nifty will therefore be closely watched in the coming sessions.
Overall, Wednesday’s close reflected a market that is cautiously optimistic, supported by improving external trade prospects, healthy domestic liquidity and selective sectoral tailwinds. While near-term volatility cannot be ruled out, the underlying tone remains positive, suggesting that investors are inclined to use declines as buying opportunities rather than exit points.