Sensex hits 81K, Nifty up—what’s driving rally?

Sensex hits 81K, Nifty up—what’s driving rally?

To reach 81,008 today,the benchmark BSE Sensex increased 766.49 points, or 0.96 percent. At 24,585.85,the NSE barometer Nifty was up 251.65 points, or 1.03%.

As concerns of a trade war subsided following China’s announcement that it was considering the idea of trade talks with the US,benchmark indices the Sensex and Nifty were trading 1% higher each on Friday. The mood was further exacerbated by a precipitous decline in oil prices,April’s in-line vehicle sales figures, and all-time high GST figures.

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Following a Maharashtra Day public holiday, the benchmark BSE Sensex increased 766.49 points, or 0.96 percent,to reach 81,008 today. At 24,585.85,the NSE barometer Nifty was up 251.65 points, or 1.03%.

“The Nifty’s overall trend is still bullish because it is still trading above all significant moving averages. The Nifty has immediate support at 24150,below which it may drop even lower,to 23870. According to Devarsh Vakil,Head of Prime Research at HDFC Securities,the 24,450–24,500 zone is anticipated to remain a significant resistance band on the upward side.

With strong Q4 results,Adani Ports led Sensex gainers,increasing 6% to 1,290. Tata Motors,IndusInd Bank,Eternal,and Maruti Suzuki all saw increases of two to three percent. 2,307 shares rose in the overall market today,while 1,205 shares fell.

Reducing trade disputes :

US-China trade tensions have decreased,according to Kranthi Bathini of WealthMills Securities,since both countries have indicated a desire to begin trade talks. He pointed out that the US Trade Representative reassured international markets by saying that trade agreements with several of the US’s biggest trading partners are probably going to be finalized in the coming weeks.

“New worries were sparked in the US by indications of a cooling labor market (a 18,000 increase in unemployment claims) and declining manufacturing output. This follows a disappointing GDP report that revealed the US GDP dropped by 0.3% in the first quarter of 2025,” he said.

Data on auto sales and oil prices :

After Saudi Arabia indicated a move to increase production and increase its market share,Vakil pointed out that oil prices had seen the biggest monthly decline in nearly three and a half years. Additionally,according to him,Indian auto majors posted April monthly sales figures that were consistent with market forecasts,with M&M leading the pack.

GST information :
In April,India’s Goods and Services Tax (GST) revenue reached a record high of over Rs 2.37 lakh crore,up 12.6% year over year. Since the tax’s implementation in 2017,this is the greatest monthly collection to date. According to Vakil of HDFC Securities,GST revenue from domestic transactions increased 10.7% to roughly Rs 1.9 lakh crore,while imports increased 20.8% to Rs 46,913 crore.

Hopes for an India-US trade agreement :
Nomura stated in a note that India’s first-mover advantage in the trade agreement will maintain its relative tariff advantage. It pointed out that a bilateral trade agreement’s terms of reference,which offer a negotiation road map,had already been agreed by the US and India.

“Details are not known, but news reports suggest the agreement has 19 chapters, covering tariff and non-tariff barriers, trade in goods and services, rules of origin, customs facilitation, digital trade and data storage, agriculture and market access, and intellectual property rights, among others,” said the statement.

What lies ahead?

According to JM Financial, the NSE benchmark has closed in the green six times in the last ten times, with an average return and a median return of 1.5% and 2%, respectively, indicating that historically, the Nifty has only shown average price seasonality in May.

According to VK Vijayakumar, Chief Investment Strategist at Geojit Investments, the short-term risk-reward ratio is not in favor of high reward at the current juncture of high valuations (the Nifty is trading at more than 20 times expected FY 26 earnings) and heightened India-Pak tensions. Even if they were still invested, he advised clients to increase the cash component of their portfolio as a precaution.

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