Sensex Surges 771 Points, Nifty Reclaims 25,000 on Global Calm, FII Inflows

Mumbai, June 20, 2025 – Indian equity benchmarks rebounded sharply on Friday, with the Sensex climbing nearly 800 points and the Nifty reclaiming the psychologically significant 25,000 mark. The rally came after three straight sessions of decline, driven by a confluence of factors including renewed foreign institutional investor (FII) buying, positive cues from Asian markets, and a temporary easing in geopolitical tensions between Iran and Israel. As investors regained risk appetite, the rally was broad-based, with key sectors like autos, cement, financials, and realty contributing to the upswing. The positive sentiment reflected confidence in India’s macro stability and growing insulation from global volatility.

Broad-Based Recovery Fueled by Large-Cap Momentum and Sectoral Rotation

A noticeable aspect of Friday’s rebound was the widespread sectoral participation, led by heavyweight stocks in autos, cement, and banking. Mahindra & Mahindra, Eicher Motors, Maruti Suzuki, and UltraTech Cement were among the top gainers on the Sensex, reflecting renewed institutional interest in core economy-linked sectors. These counters had recently corrected, creating attractive entry points for funds betting on domestic demand resilience. The State Bank of India and Bajaj Finserv also featured prominently among gainers, suggesting continued faith in the financial sector’s balance sheet strength. This rotation into cyclical and high-beta names, alongside steady buying in defensives, signaled both tactical positioning and medium-term conviction. Market analysts believe that investors are now selectively accumulating stocks tied to consumption and infrastructure narratives ahead of Q1 FY26 earnings.

Highlights:

• Autos and cement stocks led the rally, indicating domestic demand confidence.

• Mahindra & Mahindra and UltraTech Cement gained significantly intraday.

• SBI and Bajaj Finserv reflect strong traction in financial sector stocks.

• Broad participation signals rotational buying and institutional entry points.

Also Read : Nifty Tops 25,000, Sensex Gains 710 Points as Indian Stocks Rally Across Sectors

Foreign Portfolio Investors Resume Buying Amid Global Risk-On Trade

Fresh data from NSDL confirmed that Foreign Institutional Investors (FIIs) turned net buyers of Indian equities on Thursday, purchasing stocks worth ₹934.62 crore, reversing the net outflow trend seen earlier in the week. The rebound coincided with a risk-on mood in global equity markets, prompting foreign funds to allocate more aggressively to emerging markets. Domestic Institutional Investors (DIIs) also maintained buying momentum, adding ₹605.97 crore worth of equities. This synchronized inflow reinforced market stability and signaled a reversal in sentiment following weeks of cautious positioning. Several fund managers see India’s relative insulation from global rate volatility and its high-frequency indicators—like GST collections, credit growth, and rural demand—as compelling drivers for reentry by foreign capital.

Highlights:

• FIIs bought equities worth ₹934.62 crore, reversing earlier outflows.

• DIIs remained supportive with net purchases exceeding ₹600 crore.

• Fund flows reflect renewed conviction in India’s macroeconomic setup.

• Institutional accumulation strengthens confidence across market breadth.

Global Market Rally and Asian Equities Spur Optimism in Indian Markets

Indian equities mirrored the strength across major Asian stock exchanges, which all posted gains following encouraging macroeconomic prints and subsiding inflation concerns. The Nikkei 225, Hang Seng, Kospi, and Shanghai Composite rallied on improved risk sentiment, driven by positive economic signals from Japan and stimulus optimism in China. This global equity rebound, especially in regional peers, proved crucial in uplifting Indian investor morale, which had been subdued due to global geopolitical concerns earlier in the week. With oil prices stabilizing and US futures holding gains during Asian trading hours, Indian markets received the global endorsement they needed to break out of their corrective zone and regain upward momentum.

Highlights:

• Nifty and Sensex tracked gains across Asian markets like Nikkei and Hang Seng.

• Improved inflation outlook and China stimulus talk lifted global equities.

• Indian equities benefited from positive regional sentiment.

• Oil price stability and calm US futures supported market resurgence.

Temporary Geopolitical Calm Provides Breathing Room for Risk Assets

Investors found some comfort from the absence of fresh escalation in the Iran-Israel conflict, following signals from Washington that military intervention by the US may not be immediate. A White House spokesperson clarified that President Donald Trump would deliberate over the next two weeks before making any strategic decision, leaving room for potential negotiations. This breathing space allowed global risk assets to recover from a week of tension-driven volatility. Indian markets, which had remained sensitive to oil price fluctuations and war-related supply chain fears, responded positively. Crude oil prices cooled slightly, alleviating concerns for energy importers like India, while easing inflation expectations supported interest rate-sensitive sectors such as banking and real estate.

Highlights:

• US deferral on Iran intervention helped ease market fears.

• Oil prices declined slightly on hopes of diplomacy.

• Investors regained appetite for equities amid temporary geopolitical calm.

• Indian rate-sensitive sectors gained as inflation concerns moderated.

Technical Analysts Flag Key Support Zones Despite Bullish Momentum

While the Friday rebound was notable in scale, technical analysts remain cautious about the sustainability of the uptrend without broader confirmation. Anand James, Chief Market Strategist at Geojit Financial Services, noted that despite the Nifty reclaiming 25,000, only 11% of Nifty 500 stocks closed above their 10-day simple moving averages (SMA)—a signal of underlying divergence. He identified the 24,720–24,690 band as an important support zone, cautioning that a fall below this level could test the 24,500 threshold. However, he also emphasized that a deeper fall toward 24,060 looked unlikely in the immediate term. The market’s trajectory, he argued, would largely depend on foreign flows, upcoming global economic data, and further developments on the geopolitical front.

Highlights:

• Only 11% of Nifty 500 stocks closed above 10-day SMAs, signaling narrow strength.

• Key support levels for Nifty lie between 24,690 and 24,500, analysts say.

• An extended uptrend will depend on continued foreign buying and macro data.

• Short-term pullbacks remain possible despite Friday’s strong session.