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Indian Stock Market Surges: Sensex Jumps 1,200 Points as Trade Optimism and Easing Inflation Fuel Rally

Date: 15-may-2025 | By: Nuztrend Team

Indian Stock Market Surges: Sensex Jumps 1,200 Points as Trade Optimism and Easing Inflation Fuel Rally

The Indian stock market ended Thursday’s trading session with a robust rally, with benchmark indices climbing to their highest levels in over seven months. The rally was driven by favorable domestic inflation numbers and renewed global optimism over trade deals involving India, the U.S., and China.

Key Highlights

  • Sensex: Closed at 82,530.74, up 1,200.18 points (+1.48%)
  • Nifty 50: Ended at 25,062.10, up 395.20 points (+1.60%)
  • Seven-month highs for both indices

Investor sentiment improved significantly following remarks from former U.S. President Donald Trump about India’s readiness to cut tariffs on U.S. goods. Additionally, India’s retail inflation falling to a six-year low of 3.16% for April provided further confidence that the Reserve Bank of India may have room to ease policy in the coming months.

Top Performers and Sectoral Trends

Biggest Gainers – Nifty 50

  • Hero MotoCorp: +6.17%
  • JSW Steel: +4.82%
  • Tata Motors: +4.3%
  • Trent: +3.8%
  • Shriram Finance: +3.38%

The rally was broad-based, with rate-sensitive sectors like realty, auto, and banking leading the charge. IndusInd Bank was the only Nifty 50 stock in the red, down just 0.17%.

Sector-Wise Performance

  • Nifty Auto: +1.92%
  • Nifty Realty: +1.92%
  • Nifty Metal: +1.74%
  • Nifty IT: +1.16%
  • Nifty Bank: +1.0%

All sectoral indices closed in the green, indicating widespread participation in the rally. Auto and real estate stocks gained traction amid expectations of stable interest rates and favorable demand dynamics.

Broader Market Overview

  • Nifty Midcap 100: +0.69%
  • Nifty Smallcap 100: +0.54%

Broader indices followed the benchmarks, though with more modest gains. Analysts noted that mid- and small-cap stocks are seeing selective buying, particularly in capital goods, financials, and consumer discretionary segments.

Why the Rally? – Key Market Catalysts

1. U.S.–India Trade Optimism

Donald Trump’s statement that India is willing to reduce tariffs on U.S. imports created a wave of optimism in both domestic and international markets. Investors see this as a potential tailwind for Indian exporters and multinational partnerships.

2. Softening Inflation

India’s consumer price index (CPI) for April came in at 3.16%, its lowest level in six years. This opens the door for a possible rate cut by the RBI, boosting sentiment in interest-sensitive sectors like housing, autos, and NBFCs.

3. Global Market Sentiment

Global cues remained positive with easing crude oil prices and encouraging signs in U.S.–China trade negotiations. These developments helped reinforce bullish momentum across Asian markets, including India.

"India’s macro setup looks stronger now than it has in months — falling inflation, potential global trade tailwinds, and a relatively stable rupee are all working in our favor," said market strategist Neha Jain of Kotak Securities.

Outlook Going Forward

Analysts suggest the market could continue its upward trend in the near term if global tailwinds persist and inflation remains subdued. However, they also caution that volatility may return as election developments, central bank commentary, and global commodity trends unfold.

Investors are advised to stay selective and focus on companies with strong earnings visibility and sound fundamentals.

Disclaimer: This article is based on publicly available information from various online sources. We do not claim absolute accuracy or completeness. Readers are advised to cross-check facts independently before forming conclusions.

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