The Indian stock market moved into the deep green on Wednesday, snapping a two session losing streak as positive global cues and other factors boosted investor sentiment.
1) Heavy buying in FMCG stocks
Sensex gained over 600 points to 77,110, while Nifty 50 rose over 150 points to near 24,050 on Wednesday afternoon. This came as India VIX, which measures volatility in market, dropped around 2% to 13.37. The sharp gains added nearly Rs 2.5 lakh crore to the total market capitalisation of all companies listed on BSE, pulling it up to around Rs 477 lakh crore.
Eternal shares rallied over 4% to lead gains on Sensex. Asian Paints, Adani Ports and Hindustan Unilever shares meanwhile gained around 3% each to follow. Bucking the trend, IT stocks including Tech Mahindra and HCL Technologies dropped 2-3% to lead losses.
Broader markets however underperformed benchmark indices. Nifty Midcap 100 and Nifty Smallcap 100 indices are up around 0.2% each. Sectorally, Nifty FMCG and Nifty Realty gained around 2% each to lead gains, while Nifty Metal and Nifty IT dropped nearly 1% each. Around 1,914 stocks advanced on NSE, while 1,258 declined and 94 remained unchanged.
Here are the key factors boosting the stock market today.
1) Heavy buying in FMCG stocks
The sharp gains in the stock market were led by heavy buying in FMCG stocks. The Nifty FMCG index jumped more than 2% today, snapping a two-session losing streak. Dabur shares rallied more than 5%, while those of Colgate Palmolive, Nestle India, Emami, Hindustan Unilever (HUL) and Godrej Consumer Products jumped around 3% each.
Anand Rathi in its latest note said that revenue growth remained steady for most FMCG players in Q1FY27 and is expected to further accelerate due to recent price hikes. “Despite potential impact of El Nino on rural demand, we remain optimistic of steady volume growth along with moderate pricing power driving overall top line. Recent fall in the prices of crude/crude oil derivatives is likely to aid sectoral margin in the coming quarters. We like the consumer players with superior execution and potential earnings surprise i.e., Marico, GCPL and HUL in the largecap space, and Mrs Bector Foods and Zydus Wellness in small/midcap space,” it said.
2) Global cues
The sharp gains on Dalal Street comes after Wall Street ended the first half of 2026 ended on a positive note yesterday. The Dow Jones Industrial Average closed at a record 52,319.20, while the Nasdaq Composite climbed 1.52%.
Japan’s Nikkei gained around 1% while China’s Shanghai Composite gained 0.44% South Korea’s Kospi however tumbled over 2%.
3) Oil prices
While oil prices inched slightly higher, Brent crude futures continue to hover around $73 per barrel. This is significantly lower than the above $120 per barrel levels it had touched earlier this year following the closure of the Strait of Hormuz amid the escalating tensions in the Middle East.
US President Donald Trump’s son-in-law Jared Kushner and special envoy Steve Witkoff arrived in Doha on Tuesday for what the White House described as “high level” talks. However, Iran and host nation Qatar said the U.S. delegation would meet mediators instead of holding direct discussions with Iranian representatives.
Analysts have lowered their 2026 oil price forecasts for the first time since the Iran war began, following five consecutive monthly increases, after the reopening of the Strait of Hormuz reduced concerns over prolonged supply disruptions, a Reuters poll showed on Tuesday.
Why caution is warranted?
Despite the renewed optimism on Dalal Street, some caution is warranted. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted that a major concern weighing on the market now is the poor monsoon which so far has been worse than expected. June has ended with a 40% rain deficit and for July, the IMD has predicted below normal rainfall. If this trend continues the actual rainfall this monsoon season may fall below the IMD’s forecast of 90% of long-term average, according to the analyst, who added that the market has not yet discounted this negative trend.
“Investors may fine tune portfolios to discount the potential negative fallout of poor monsoon. Partial portfolio adjustment in favour of fixed income may be considered. Also churning of portfolios in favour of monsoon-proof sectors like health care, pharmaceuticals, power and select fairly valued defence stocks is advisable,” according to Vijayakumar.
Technical view on Nifty
On the upside, Nifty continues to face resistance around its 100-DMA at 24,130, and a decisive close above this level would confirm a meaningful breakout, said Nilesh Jain, VP- Head of Technical and Derivative research at Centrum Finverse. He added that momentum indicators continue to support the positive bias, with the MACD maintaining a buy crossover above the zero line and the RSI holding above the 50 mark, indicating sustained bullish momentum.
“The broader technical structure remains constructive, and the buy on dips strategy remains intact as long as the index sustains above its short-term 21-DMA, placed at 23,690,” he said.
(With inputs from agencies)
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)