Stock markets staged a strong comeback on Tuesday as the benchmark indices rallied significantly, recouping most of the losses from Monday’s steep decline. The BSE Sensex surged 1,089.18 points or 1.49 per cent to close at 74,227.08, while the NSE Nifty 50 gained 374.25 points or 1.69 per cent to finish at 22,535.85.

The rebound came as global markets showed signs of stability despite ongoing concerns about the US-China trade tensions, with investors hoping for potential concessions ahead of Wednesday’s deadline for reciprocal tariffs.

“Following positive global cues, led by the interest of many nations to enter into bilateral agreements with the US, the domestic market witnessed a recovery,” said Vinod Nair, Head of Research at Geojit Investments Limited. “Moreover, this optimism stems from the fact that the Indian economy is more driven by local demand and low reciprocal tariff and ongoing trade negotiations with the US.”

In the NSE, Jio Financial Services emerged as the top gainer, surging 5.61 per cent to close at ₹225.49. Shriram Finance followed closely with a 5.21 per cent gain to ₹646.00, while Bharat Electronics Limited (BEL) rose 3.69 per cent to ₹282.15. Adani Enterprises and Cipla also performed strongly, advancing 3.45 per cent and 3.44 per cent respectively. Power Grid was the sole loser among Nifty stocks, marginally declining by 0.09 per cent to ₹289.15.

Market breadth remained overwhelmingly positive with 3,093 stocks advancing against 871 declines on the BSE, while 119 remained unchanged. Fifty-two stocks hit their 52-week highs, while 54 touched their 52-week lows.

The broader market outperformed the benchmark indices, with the Nifty Midcap 100 rising 2.11 per cent to 49,838.00 and the Nifty Next 50 gaining 2.12 per cent to 60,807.55. Sectoral indices also showed strength, with Nifty Financial Services rising 1.64 per cent to 24,301.50 and Nifty Bank advancing 1.31 per cent to 50,511.00.

“It was a rollercoaster ride for the Nifty, showcasing significant intraday volatility,” noted Nandish Shah, Deputy Vice President at HDFC Securities. “Nifty witnessed an initial surge right at the open, with the index gapping up a substantial 285 points. This early enthusiasm, however, proved short-lived as profit-taking kicked in, pulling the Nifty down by over 300 points from its morning peak of 22,577 within the first half of the trading day.”

The market’s recovery comes ahead of the Reserve Bank of India’s monetary policy decision expected on Wednesday, with most analysts anticipating a 25 basis points rate cut. “All eyes are on the RBI policy decision tomorrow, where a 25-bps rate cut is anticipated,” added Vinod Nair.

The Indian rupee, however, continued to weaken against the US dollar. “The Indian rupee experienced a decline in value against the US dollar, primarily driven by strong demand for dollars from importers and ongoing outflows of foreign funds from Indian equity markets,” said Dilip Parmar, Research Analyst at HDFC Securities. The rupee closed at 86.27 against the dollar, down 44 paise, marking its lowest level since March 20, 2025.

Gold prices rebounded sharply, gaining ₹1,100 in MCX to move above ₹88,000, benefiting from the weaker rupee and renewed safe-haven demand amid trade tensions. “The global sentiment remained cautious with the dollar index moving sideways near the 102 mark, offering no strong headwinds to gold,” according to Jateen Trivedi, VP Research Analyst at LKP Securities.

Technically, the market showed signs of a potential bottom formation. “After witnessing a fine upside recovery from the significant intraday lows on Monday, Nifty continued its follow-through upmove on Tuesday,” observed Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities. “As per the gap theory, the said down gap could be considered as a bullish exhaustion gap and that is likely to be filled soon around 22,850 levels on the higher side.”

Market experts, however, advised caution despite the strong rebound. “Participants are advised not to read too much into this single-day recovery, as tariff-related developments are likely to keep volatility elevated,” warned Ajit Mishra, SVP of Research at Religare Broking Ltd. The India VIX, a measure of market volatility, cooled off by 10.31 per cent to 20.44, indicating easing market tension after Monday’s spike.

Looking ahead, market direction will likely be influenced by the RBI policy outcome, global trade developments, and the upcoming quarterly earnings season.

Published on April 8, 2025