Markets witnessed a powerful rally on Friday, with both Sensex and Nifty gaining 1.29 per cent as geopolitical tensions in the Middle East showed signs of moderation and crude oil prices softened. The Nifty 50 crossed the important 25,000 mark, closing at 25,112.40, while the Sensex settled at a fresh high of 82,408.17.

The Sensex rallied 1,046.30 points from its previous close of 81,361.87, while the Nifty 50 zoomed 319.15 points from 24,793.25. Both indices opened marginally lower but staged a sharp recovery throughout the trading session, with the Nifty touching an intraday high of 25,078.

“Markets showed strength and gained over a per cent after three sessions of lackluster movement,” said Ajit Mishra, SVP Research at Religare Broking Ltd. “Sentiment improved after the news report indicated a possible de-escalation in the Iran-Israel conflict, with the U.S. signaling a delay in potential action, which led to a softening in crude oil prices.”

All sectoral indices ended in positive territory, with realty, banking, financial services and metal stocks leading the charge. The Nifty Bank surged 675.40 points or 1.22 per cent to 56,252.85, while Nifty Financial Services gained 349.05 points or 1.33 per cent to 26,648.70. The broader markets also participated in the rally, with Nifty Midcap 100 rising 835.55 points or 1.46 per cent to 57,995.50.

Among individual stocks, Trent emerged as the top gainer on Nifty 50, surging 3.96 per cent to 5,950.00, followed by Jio Financial Services which gained 3.31 per cent to 293.50. Mahindra & Mahindra advanced 3.07 per cent to 3,189.90, while Bharti Airtel rose 3.04 per cent to 1,934.00 and Nestle India climbed 2.77 per cent to 2,383.10.

On the losing side, Hero MotoCorp declined 1.21 per cent to 4,331.10, while Dr Reddy’s Laboratories fell 0.25 per cent to 1,322.80. Maruti Suzuki dropped 0.15 per cent to 12,787.00, ONGC slipped 0.14 per cent to 251.20, and Axis Bank declined 0.11 per cent to 1,216.10.

Market breadth remained robust with 2,463 stocks advancing against 1,484 declining on BSE. A total of 83 stocks hit 52-week highs while 84 touched 52-week lows. Additionally, 186 stocks were locked in upper circuit while 227 hit lower circuit.

“The national equity indices surged as Middle East tension moderated with risk of immediate military actions reduced as US dialogue with Iran is expected to take place,” noted Vinod Nair, Head of Research at Geojit Investments Limited. “The development led the crude price to correct, favouring domestic markets and boosting foreign investors’ sentiments.”

Foreign and domestic institutional investors continued their buying spree, providing strong support to the markets. “Relentless inflows from institutional investors—both Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs)—acted as key tailwinds, offsetting headwinds from prevailing geopolitical uncertainties,” according to Bajaj Broking Research.

In the currency markets, the rupee strengthened against the dollar. “Rupee traded positive with gains of 0.15 at 86.57, supported by softer crude oil prices and a weaker dollar index,” said Jateen Trivedi, VP Research Analyst at LKP Securities. “Continued FII and DII inflows into Indian markets have helped limit the rupee’s downside despite ongoing geopolitical tensions over the past few months.”

However, commodities presented a mixed picture. Gold prices faced pressure, falling by 500-750 rupees to around 98,800 on MCX. “Gold prices traded weak, following pressure from a hawkish stance by the US Federal Reserve,” Trivedi explained. “The Fed pushed back expectations of any imminent rate cut, which led to unwinding of recent gains in Comex gold as well.”

Technical analysts remained optimistic about the market’s near-term prospects. “Nifty moved up sharply after three days of consolidation, resuming its short-term rally,” said Rupak De, Senior Technical Analyst at LKP Securities. “Moreover, the index has reclaimed the 21-day EMA, which could provide further momentum for an upward move.”

Prashanth Tapse, Senior VP Research at Mehta Equities Ltd, attributed the rally to “strong European cues and positive Dow Futures” which “triggered a massive rally in local benchmarks.” He added that “investors also resorted to short covering ahead of next week’s monthly derivatives expiry.”

Looking ahead, market participants expect continued strength as long as geopolitical tensions remain contained. “The outlook remains positive, and a decisive move above 25,200 on the Nifty would signal the end of the ongoing 5-week consolidation phase and open the path toward the 25,600–25,800 zone,” Mishra noted, while maintaining a “positive yet cautious stance” given the absence of major domestic events next week.

Published on June 20, 2025