Indian Stock Markets Rebound Sharply as FII Buying Resumes and Geopolitical Tensions Ease

Mumbai: Indian stock markets staged a strong comeback this week, ending a prolonged five-week consolidation phase. The rally was primarily driven by renewed foreign institutional investor (FII) interest, easing geopolitical concerns, and positive global cues, analysts reported.

The Nifty 50 closed at 25,637.80, while the BSE Sensex surged to 84,058.90, registering their highest closing levels in over nine months.

Middle East Tensions Ease, Fueling Market Confidence

One of the key triggers for the market’s rise was the de-escalation of tensions between Iran and Israel. The fragile truce held through the week, boosting global risk appetite.

“The rally was underpinned by easing Middle East tensions and a strong rebound in FII inflows,” said Ajit Mishra, SVP – Research at Religare Broking.

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This helped revive investor sentiment, particularly in global markets, and supported India’s equity momentum midweek.

FIIs Pump ₹12,000 Crore in a Day, Backing Bullish Sentiment

Foreign institutional investors made a strong return to Indian equities, with FII inflows exceeding ₹12,000 crore in a single day. This marked the highest daily FII infusion in recent months, adding to the positive undertone across sectors.

Stable domestic macroeconomic conditions, falling crude oil prices, and progress in monsoon coverage further supported the market’s upward trajectory.

Sectoral Performance: Metals, Financials Lead; Realty Sees Profit Booking

Almost all sectors contributed to the market rally:

• Metals led the charge, followed by financials, energy, and banking stocks.
• IT stocks showed signs of recovery, ending flat due to bargain buying and supportive global tech trends.
• Real estate stocks witnessed mild profit booking and ended marginally lower after weeks of gains.
• Broader indices also outperformed, with midcap and small-cap indices gaining between 2.4% and 4.3%, reflecting a clear risk-on sentiment.

Sensex Hits 9-Month High, Closes 303 Points Higher on Friday

On Friday, the Sensex rose by 303.03 points (0.36%) to settle at 84,058.90, after trading in a tight range of 83,645.41 to 84,089.35. This marks a significant technical breakout, pointing to renewed investor confidence in near-term market stability.

Global and Domestic Data to Influence Next Week’s Market Trend

Looking ahead, investors are closely watching the upcoming Q1 earnings season for early signs of corporate growth. Additionally, key global trade agreements and U.S. tariff decisions (expected from July 9) could drive sentiment.

Back home, the market will track:

• Monsoon progress
• FII activity
• High-frequency macro data including IIP and PMI figures

“Despite improved sentiment, global trade tensions and corporate earnings will remain the key triggers,” noted Vinod Nair, Head of Research at Geojit Financial Services.

After weeks of uncertainty, Indian equity markets are back in bullish territory, driven by FII support, easing global tensions, and strong sectoral participation. While caution remains due to global risks, domestic factors appear favorable for a continued uptrend, provided earnings and monsoon data remain supportive.