(25-Mar-2025)Sensex, Nifty set to extend gains

GIFT Nifty:

The GIFT Nifty March 2025 futures contract is up 21 points, indicating a positive opening in the Nifty 50 index today.

Institutional Flows:

Foreign portfolio investors (FPIs) bought shares worth Rs 3,055.76 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 98.54 crore in the Indian equity market on 24 March 2025, provisional data showed.

According to NSDL data, FPIs have sold shares worth Rs 28154.42 crore (so far) in the secondary market during March 2025. This follows their sale of shares worth Rs 41748.97 crore in February 2024.

Global Markets:

Most Asian stocks climbed on Tuesday, tracking overnight gains on Wall Street, as investors grew optimistic that U.S. President Donald Trump's tariffs might be less severe than anticipated.

In China, the central bank announced changes to the way it sells medium-term loans, a move that market participants believe could further diminish the role of such instruments in guiding monetary policy. The People's Bank of China (PBOC) stated it will issue 450 billion yuan ($62.03 billion) in one-year medium-term lending facility (MLF) loans on Tuesday. Starting this month, MLF operations will be conducted using a fixed-quantity, interest-rate bidding, and multiple-price bidding method, the PBOC added.

On Wall Street, U.S. indices surged on Monday amid reports that Trump's April 2 tariffs will be less harsh than previously feared. The Dow Jones Industrial Average jumped 1.42%, the S&P 500 climbed 1.76%, and the tech-heavy Nasdaq Composite soared 2.27%.

Tesla shares, which had been declining for nine consecutive weeks, rebounded nearly 12%, building on their Friday gains. Meta Platforms and Nvidia also saw gains of more than 3%.

Meanwhile, 23AndMe Holding Co plummeted 59% after filing for Chapter 11 bankruptcy protection.

Wall Street has been under pressure in recent weeks amid concerns that Trump's tariffs could drive up inflation, disrupt global trade, and slow economic growth. Earlier this month, major indices slumped to six-month lows on such fears.

While Trump has repeatedly described April 2 as 'liberation day' for the U.S., investors found some relief in signs that the tariffs' scope may be narrower than initially expected, potentially limiting their economic impact.

Domestic Market:

The domestic stock market extended its rally for the sixth consecutive session on Monday, with the Sensex soaring over 1,000 points and the Nifty50 closing above 23,650, driven by gains in banking and energy stocks. Analysts attribute this surge to improving domestic economic cues, falling U.S. Treasury yields'making emerging markets like India more attractive'and a return to value buying as valuations normalize. Foreign Institutional Investors (FIIs) have turned net buyers in three of the last four sessions, reversing months of selling, while central bank liquidity measures have further boosted sentiment. However, the rally's sustainability will depend on Q4 earnings results and developments surrounding U.S. tariffs.

The S&P BSE Sensex surged 1,078.87 points, or 1.40%, to 77,984.38. The Nifty 50 index rallied 307.95 points, or 1.32%, to 23,658.35. In the six consecutive sessions, both the indices jumped 5.63% each.