Sensex closed 2.1% higher at 74,316, up 1,534 points, while Nifty rose 1.7% to 22,997, marking the sharpest rally since early September.
Foreign funds sold a net 5,285 crore on the day, according to BSE data, while domestic funds bought 3,319 crore, a clear sign that local capital is still in play even as global investors pull back.
The rupee steadied at 83.12 against the dollar, and crude prices dipped 0.9% to $70.1, easing pressure on the market. Short‑covering by speculators, who cut losses at the session’s close, added momentum, especially in sectors with high overnight activity.
Vinod Nair, head of research at Geojit Investments, said the rally reflects India’s comparatively lower valuation versus peers and a rotation into domestic large‑cap tech, private financials and defensive names. He added that the near‑term sustainability of the move will depend on the July‑September earnings cycle and the return of foreign funds.
With global markets in decline—Kospi down 8%, Nikkei down 4.9%, and Shanghai Composite down 1.6%—India’s relative appeal is highlighted. Traders now watch for corporate earnings releases next week, and whether foreign investors resume allocations, as these will shape the index’s trajectory in the coming days.