Why is market rising today? Sensex soars over 800 pts, Nifty tops 24,200; 4 key factors powering D-Street

The Indian stock market surged on Wednesday, with benchmark indices Sensex and Nifty rising nearly 1% each, despite a sharp increase in oil prices as US-Iran tensions escalated.

At 9:49 am Sensex soared above 800 points to trade at 77,550 level, while Nifty gained over 200 points to trade above 24,200 mark. The sharp gains added around Rs 3 lakh crore to the total market capitalisation of all companies listed on BSE, pulling it up to Rs 482 lakh crore.

Infosys, L&T, Eternal, Hindustan Unilever, Bharti Airtel, TCS, Bajaj Finance, M&M, Tech Mahindra, HDFC Bank and HCL Technologies shares were the top gainers on Sensex, jumping up to 3%. Bucking the trend, IndiGo shares fell nearly 1% as oil prices soared over 4% after joint strikes in Iraq by US and Saudi Arabia, and the interception of Iran’s ballistic missiles aimed at US forces in the Middle East spooked investors.

India VIX, which is a measure of volatility in the market, dropped more than 3% to 12.18 despite the renewed uncertainties. Broader markets also traded in deep green, with Nifty Midcap 100 and Nifty Smallcap 100 indices rising up to 0.6%.

Sectorally, Nifty IT and Nifty Metal jumped 1-2% to lead gains, while Nifty Realty and Nifty Oil & Gas slipped into the red. The overall market breadth turned positive, with the NSE seeing 1,894 advances against 641 declines, while 102 stocks remained unchanged.

Here are the 4 key factors pushing the market higher today. 1) Global AI selloff continues

IT stocks including Infosys and HCL Tech are among the top gainers on Dalal Street today. A large part of it may have been driven by India’s resilience to the ongoing global AI selloff. South Korea’s Kospi, consisting heavily of chipmakers, crashed around 9% today while Japan’s Nikkei was down over 4%. Taiwan Weighted, meanwhile, dropped over 4%.

This comes as India comparatively has a smaller number of large listed companies directly tied to the AI infrastructure boom, providing it resilience at a time when analysts are questioning whether the massive AI spending by hyperscalers will actually bear fruit in the future, triggering AI bubble worries.

2) Rupee gains

The rupee rose 12 paise to 95.70 against the US dollar in early trade on Wednesday. The Indian currency has drawn support over the last three sessions from likely intervention by the Reserve Bank of India, which traders expect will continue to underpin the currency.

“Going forward, the rupee will continue to take cues from crude oil prices, the US Dollar Index, FII flows, and the upcoming US Federal Reserve policy decision. Technically, the rupee is expected to trade in the 95.50-96.25 range in the near term,” said Jateen Trivedi, VP Research Analyst of Commodity and Currency at LKP Securities.