Decoding Stock Market Rally: 3 Reasons Why Sensex Surged 905 Points Today

Indian stock market ended sharply higher on Thursday, October 29, and a US Fed rate pause, broad-based buying and a slight dip in crude rates emerged as key triggers behind the rally. BSE Sensex, the 30-share index, soared 905.01 points or 1.24 per cent to close at 74,151.04. Nifty50 settled at 22,936.75, up 237.90 points or 1.05 per cent.

Additionally, Institutional buying was also a factor behind the upside momentum.

Top 3 Factors Behind Rally In Stock Market

1- US Fed Rate Pause

US FOMC decided to keep the rates steady at 3.75-4 per cent, giving a respite to global markets amid inflation headwinds.

2- A Dip In Crude Prices

Crude prices saw a slight dip on Thursday, giving a boost to the Indian market. However, oil prices remained higher. Last seen, Brent Crude, the global oil benchmark, was at $114.2. down $1.16 or 1.01 per cent.

Vinod Nair, Head of Research, Geojit Investments Limited, says, "Indian equities rallied as the US Fed’s rate pause, marginal easing in crude and renewed institutional buying improved risk appetite despite a challenging external backdrop."

3- Broad-Based Rally

Rally in broader market kept the momentum higher. FMCG, Pharma, IT, Realty and other sectors saw a significant rise. Small-cap and mid-cap indices closed in green as well.

"FMCG led gains on resilient consumer demand, while financials, IT, realty and power strengthened, with mid- and small-caps also participating, signalling healthier market breadth. Recent foreign buying alongside sustained domestic institutional support has also improved the liquidity backdrop," Nair added.

Top Gainers And Losers 

Twenty-six stocks from the 30-stock Sensex basket settled higher, while four closed in red.