Market Benchmarks Rebound Strongly After Recent Losing Streak
Indian equity markets ended the final trading session of 2025 on a strong note, snapping a multi-day losing streak as benchmark indices rebounded sharply on Wednesday. The Sensex surged nearly 400 points, while the Nifty reclaimed the crucial 26,050 mark, supported by a rally in steel stocks, cooling volatility, and value buying across segments.
After declining for five consecutive sessions, the Sensex jumped 384.45 points, or 0.45 percent, to 85,059.53. The Nifty 50, which had fallen for four straight sessions, rose 139.20 points, or 0.54 percent, to 26,078.05 during the session. Market breadth turned decisively positive, with about 2,455 shares advancing against 1,009 declines, indicating broad-based participation in the rebound.
A market dealer said, “The year-end session saw a classic relief rally. Policy support for steel and bargain buying at lower levels brought buyers back into the market.”
Steel Stocks Power the Rally After Safeguard Duty Announcement
The strongest trigger for Wednesday’s market rebound came from the metal space, particularly steel stocks. Shares of major steelmakers rallied after the government announced a three-year safeguard duty of up to 12 percent on select steel imports. The move is expected to provide pricing support to domestic producers by shielding them from cheaper overseas supplies.
Tata Steel climbed over 2 percent to Rs 179.7, while JSW Steel gained more than 3 percent to Rs 1,148. Jindal Steel & Power rose around 3.6 percent to Rs 1,057.8, and Jindal Stainless advanced nearly 3 percent to Rs 859.7. NMDC also traded marginally higher.
The announcement sparked optimism about margin improvement and earnings stability for domestic steel companies, making metal stocks among the top contributors to index gains.
Also Read : Sensex And Nifty End Slightly Lower As F&O Expiry Triggers Volatility; PSU Banks Rise
Value Buying Emerges After Sustained Market Correction
Another key factor behind the rally was value buying after the recent correction in benchmark indices. The Sensex had declined for five consecutive sessions, while the Nifty had fallen for four, pushing several frontline stocks into attractive valuation zones.
Traders and long-term investors were seen selectively accumulating quality stocks, especially in cyclicals and large-cap names, leading to a steady recovery through the session.
Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Ltd, said, “The market has the potential for a directional move upwards but is being weighed down by sustained FII selling and the absence of fresh triggers like positive news on the US-India trade front.”
Volatility Eases as India VIX Slips Below 9.5
Market sentiment was further supported by a sharp decline in volatility. India VIX, the volatility index, fell more than 3 percent to around 9.37, signalling reduced fear and uncertainty among investors.
A lower VIX typically encourages risk-taking and improves confidence in equities, particularly after a period of sharp swings. The easing volatility helped investors look past near-term global uncertainties and focus on domestic cues.
Market participants noted that volatility cooling at year-end often creates room for relief rallies, especially when combined with supportive sector-specific developments.
Mid- and Small-Cap Stocks Join the Upside
The rebound was not limited to frontline indices alone. Strong buying interest was also seen in the broader market, with both Nifty Midcap and Smallcap indices rising by up to 1 percent.
The participation of mid- and small-cap stocks added strength to the rally and reflected improving risk appetite. Investors selectively picked stocks with strong fundamentals, recent corrections, or sectoral tailwinds, supporting overall market sentiment.
Analysts believe broader market participation is essential for any sustainable recovery, and Wednesday’s session provided early signs of that support.
Mixed Performance Among Index Heavyweights
While metal stocks led the rally, index heavyweights showed a mixed trend. JSW Steel, Tata Steel, and Titan Company were among the top gainers in the Nifty 50 pack, rising up to 5 percent.
On the downside, Tata Consultancy Services and Bajaj Finance were among the notable laggards, slipping up to 1 percent. The weakness in select IT and financial stocks capped sharper gains in the benchmarks, keeping the rally measured rather than euphoric.
Technical View Signals Cautious Optimism
From a technical perspective, analysts said the recovery was encouraging but not yet a confirmed trend reversal. Anand James, Chief Market Strategist at Geojit Investments Ltd, noted that the Nifty’s dip towards the 25,850 zone attracted bargain buying, but key resistance levels remain in focus.
“We will persist with a bearish view while below 25,970, but will be prepared to play the upside if the index moves past 26,027. Otherwise, a move towards the 25,740–25,650 region is possible, though that appears less likely today,” he said.
The ability of the Nifty to sustain above the 26,000–26,050 zone will be crucial in determining whether the rebound extends into the early sessions of 2026.
Investor Takeaway: Positive End to 2025, But Caution Remains
The strong finish to the final session of 2025 provided investors with some relief after recent losses. Policy support for steel, easing volatility, and value buying helped markets recover, while broader participation added confidence.
However, experts caution that sustained upside will depend on fresh triggers such as clarity on global interest rates, foreign fund flows, and developments on the US-India trade front. As markets head into 2026, investors are expected to remain selective, focusing on sectors with strong earnings visibility and policy support.
As one market strategist summed it up, “This rebound is a good way to end the year, but the real test will be whether momentum carries into the new year with stronger global and domestic cues.”
