Stock market rally today: Indian equity benchmarks, Nifty50 and BSE Sensex, rallied strongly in morning trade on Thursday on favourable global cues, falling oil prices, and sharp appreciation in rupee this week.Buying in IT, banking and consumer stocks lifted the stock market sentiment. At 10:36 AM, Nifty50 was trading at 22,915.15, up 292 points or 1.29%. BSE Sensex was at 73,777.19, up 995 points or 1.37%.
Why is the stock market rallying today?
Oil prices dropOil prices dropped by more than $1 on Thursday as investors weighed the possibility of supply disruptions caused by attacks on shipping in the Strait of Hormuz against US efforts to reduce the cost of transporting petroleum by relaxing sanctions on vessels.Brent crude futures fell $1.76, or 1.75%, to $104 a barrel. US West Texas Intermediate (WTI) crude futures dropped $1.02, or 1.07%, to $94.07 a barrel. Both benchmarks gave up the gains recorded during the previous session.IT stocks rallyIT stocks continued to advance for a third consecutive session, with TCS, Infosys, HCL Tech and Tech Mahindra rising. The rally was supported by improving earnings and a selloff in stocks linked to artificial intelligence.Asian markets, however, opened lower on Thursday after US consumer inflation came in higher than expected. The data strengthened expectations that the Federal Reserve could take action later this year, putting pressure on global equities.MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.2%, dragged down by a 7% decline in South Korea’s KOSPI. Japan’s Nikkei 225 slipped 1.3%, while S&P 500 e-mini futures were down 0.3%.Wall Street also ended Wednesday’s session in the red. AI-linked stocks came under pressure, pulling the broader market lower as investors assessed US consumer inflation data for September, which was hotter than anticipated.VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said the correction in AI stocks could work in favour of Indian equities. He explained that foreign institutional investors (FIIs), who have been selling Indian shares while investing in AI stocks, could pause this trend or even reverse it if conditions become favourable.“FIIs who have been selling Indian stocks and buying AI stocks will halt this trend and under favourable conditions might even reverse it. Indications that the finance ministry might reconsider the taxation of LTCGs in the coming Budget, have the potential to keep the market resilient,” he added.Rupee appreciates sharplyThe rupee began Thursday’s session 0.2% stronger at 94.92 against the US dollar. The dollar weakened after touching an 18-month high overnight.RBI unveiled a series of measures to protect the rupee from volatility last weekend. The currency has since then appreciated sharply though experts believe the measures are likely to have a short-term impact even as global pressures continue.(Disclaimer: Recommendations and views on the stock market, or any other asset classes or personal finance management tips given by experts and analysts are their own. These opinions do not represent the views of The Times of India.)