After a six-week losing streak — the longest since the COVID-led crash of 2020 — Indian equity markets staged a strong comeback on August 11, with the Sensex reclaiming the 80,000 mark and the Nifty holding above 24,600.
At 3:10 pm, the Sensex was up 762 points at 80,620, while the Nifty gained 235 points to trade at 24,598. Market breadth was slightly positive, with more stocks advancing than declining.
Five Key Reasons Driving the Rally
1. Value Buying After Heavy Sell-Off
Following a steep six-week slide — partly triggered by the US President Donald Trump’s 50% tariffs on Indian goods — bargain hunters stepped in.
“While momentum is still tilted downwards, the recent fall has created opportunities for a technical rebound,” said Santosh Meena of Swastika Investmart. Analysts note that the 24,200–24,000 zone is a critical support for Nifty, and a break above 24,590 could pave the way toward 25,000 in the near term.
2. Positive Global Cues
Asian markets traded higher on upbeat corporate earnings, while US futures edged up after Wall Street’s strong close last Friday. Tech giants like Apple surged, with the Nasdaq marking a second straight record high. Investors are also watching US inflation data and geopolitical developments closely.
3. Gains in SBI and Grasim Industries
SBI shares rose 2.2% after the bank posted a 12.5% year-on-year profit jump, led by stronger non-lending income.
Grasim Industries also gained 2.2%, supported by better-than-expected earnings and positive brokerage commentary on its chemicals business.
4. Oil Prices Drop
Crude oil prices fell further, with Brent trading at $66.26 per barrel. The drop comes amid optimism over US-Russia talks scheduled for August 15, which could potentially lead to an end to sanctions and ease supply constraints.
5. Strong Mutual Fund Inflows
The Association of Mutual Funds in India (AMFI) reported an 81% surge in equity inflows to ₹42,672 crore in July, marking the 53rd straight month of positive inflows. This indicates strong retail investor confidence despite recent market weakness.
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Expert View
VK Vijayakumar of Geojit Financial Services said,
“If Trump-Putin talks lead to an end to the Russia-Ukraine war, US sanctions on Russia could be lifted and the punitive tariffs on India reconsidered — potentially sparking a sharp market rebound.”
He also noted that while short-covering could boost markets in the near term, sustained gains will require earnings growth, which may emerge from Q3 onwards.
