Sensex rises 450 pts, Nifty above 25,900: Six key reasons behind markets snapping three-day losses

The equity benchmark indices staged a sharp recovery on Thursday, rising over 400 points from the day’s low in a highly volatile session marked by the weekly derivatives expiry of Sensex.
The markets opened firm but soon gave up early gains and slipped into the red. Benchmark indices later bounced back as value buying emerged after three straight sessions of decline.
At around 12:35 pm, the Sensex was up 449.62 points or 0.53 percent to 84,840.89, while the broader Nifty advanced to 25,906.90, up 148.90 points or 0.58 percent.
Earlier in the session, both indices had dropped sharply, with the Sensex falling 222.39 points to 84,168.88 and the Nifty slipping 50.90 points to 25,707.10 on renewed selling pressure.
ETERNAL, Kotak Mahindra Bank and Jio Financial Services were among the top gainers in the Nifty50 pack, rising up to 2 percent, while Trent and Bharti Airtel declined up to 1 percent. Market breadth turned positive as about 1869 shares advanced, 1575 shares declined and 158 shares unchanged.
Key factors behind the recovery
1) Value buying: Buying interest returned in sectors such as IT, auto, metal, realty, banking and financial services after recent losses. Metal stocks gained up to 1 percent, tracking firmer global prices on a weaker US dollar, which makes commodities cheaper for overseas buyers. IT shares were up around 0.3 percent after Fed rate cut. Strong buying was also seen in Bank Nifty was up 0.7 percent.
2) Trade deal hopes: The investor mood improved after India’s chief economic advisor V. Anantha Nageswaran said most of the trade issues between New Delhi and Washington have been “sorted out”. The top economist, in an interview with Bloomberg TV, said he has full confidence that an agreement will be reached by March 2026.
Earlier, the US Trade Representative Jamieson Greer told lawmakers that India has made “the best we’ve ever received as a country” in ongoing discussions, IANS reported.
CEA Nageswaran says most trade issues between India, US 'sorted out'
3) US Fed rate cut: The US Federal Reserve on Wednesday reduced its benchmark interest rate by 25 basis points, the lowest level in more than three years. Lower US rates generally support flows into emerging markets, including India, and tend to improve business spending outlooks for sectors like IT.
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4) Volatility index eases: India VIX declined nearly 2 percent to 10.74. A softer VIX generally indicates reduced near-term market uncertainty, offering some support to sentiment.
5) Global cues: US equities closed higher overnight after the Fed’s rate cut, providing positive cues for domestic investors.
6) Expiry-related volatility: The session coincided with the weekly expiry of Sensex derivatives, a period that typically sees sharp intraday swings as traders unwind or roll over positions.
Technical view
Anand James, Chief Market Strategist at Geojit Financial Services, said the Nifty’s revisit of the previous day’s low of 25,732 offered little directional clarity, with momentum indicators remaining soft. "The bias continues to favour further slippage. A regrouping of bulls is expected in the 25,690–25,630 zone, and a fall below this band would weaken upside prospects," he said.
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