Indian equity benchmarks staged a robust recovery on Tuesday, with the Sensex rising as much as 696 points and Nifty50 touching an intraday high of 22,581 in noon deals. According to The Economic Times, the market witnessed a sharp recovery after opening lower, rebounding from the previous session's brutal selloff even as investors remained on edge on Nifty's expiry day. The Sensex hit an intraday high of 72,620.91, up 0.97% from the previous close, while the Nifty touched 22,581.15, also up 0.97%. The fightback came despite negative global cues, with South Korea's Kospi index leading an Asian market rout with a 7% crash and Japan's Nikkei down more than 2%. Market sentiment improved amid a decline in global crude oil prices, easing US bond yields, and strong global cues, with buying concentrated in information technology and fast-moving consumer goods stocks.
The benchmarks moved higher after sentiment turned positive as the International Monetary Fund (IMF) raised India's economic growth forecast to 7% for 2026, citing stronger-than-expected economic momentum, resilient domestic demand and robust services activity. In its October 2026 World Economic Outlook, the IMF said India remained among the fastest-growing major economies, with activity holding up despite higher oil prices and global economic uncertainty. The latest projection reflects stronger-than-expected momentum in the Indian economy, supported by domestic demand and the services sector, the report said. This positive development provided significant support to market sentiment and helped offset negative global cues that had weighed on investor confidence.
IT sector stocks emerged as the primary drivers of Tuesday's market rally, with Nifty IT surging 4.49% to hit an intraday high of 29,623.90 levels, significantly outperforming the broader market. As per The Economic Times, HCL Tech was the top gainer, rising nearly 5% after its September-quarter consolidated net profit rose 11% sequentially to ₹5,132 crore. The company recorded advanced artificial intelligence (AI) revenue of $219 million, in CC terms, marking a 28.4% QoQ and 78% YoY growth. Heavyweight peer TCS gained about 4% in early trade, a week after its own results, while Tech Mahindra rose about 2% and Infosys about 1.5%. The sector's strong performance reflects renewed confidence in India's technology sector amid global uncertainties, particularly as South Korea's Kospi crashed more than 6% while Japan's Nikkei was down more than 2%, with analysts warning of a bubble around artificial intelligence optimism. IT's strength stands out on a day when the global move was driven by a chip selloff, with Indian IT trading on its own results.
The sentiment also got a boost from the rupee appreciating 82 paise to 94.96 against the US dollar, supported by various RBI measures aimed at reducing immediate dollar demand and curbing excessive positions in the foreign exchange market. The Reserve Bank of India on Saturday tightened rules governing forex derivatives trades to curtail speculative bets against the rupee and asked banks to create a 20% reserve for dollar purchases of over $2 million. In another set of measures announced on Saturday on the derivatives front, the RBI said authorised dealers should not permit users to rebook any foreign exchange derivative contract involving the INR, whether deliverable or non-deliverable, which has been cancelled. The rupee strength provided additional support to market sentiment and helped ease concerns about currency volatility that had previously weighed on investor confidence.
TCS, Infosys, HDFC Bank, HCL Technologies, ICICI Bank, Hindustan Unilever, Tech Mahindra, Bharti Airtel and Bajaj Finance were top movers in the SENSEX, collectively contributing over 450 points towards the gain. According to The Economic Times, 10 of 15 sector gauges compiled by the National Stock Exchange (NSE) were trading higher, led by the NIFTY IT index's over 4% gain. FMCG, realty, auto, banking and financial services shares were also witnessing buying interest, while pharma, healthcare, metal, media and oil & gas shares were underperforming. Broader markets were underperforming their larger peers as NIFTY Midcap 100 index declined 0.1% while NIFTY Smallcap 100 index dropped 1%. The overall market breadth was negative as 2,028 shares declining while 1,396 were advancing on the NSE.
