SENSEX, NIFTY rally for sixth straight session, outperform global peers; here's why

The equity stock markets continued their stellar run for the sixth straight session on Tuesday, April 22, with both the benchmark indices NIFTY50 and SENSEX hitting their highest level in nearly five months. The NIFTY50 index has surged 8.23% or 1,843 points to 24,242.60 and SENSEX climbed 8.09% or 5,977 points to hit intraday high of 79,824.30.

The rally is being driven by a mix of favourable domestic and international factors, with a strong performance from banking stocks, improving macroeconomic fundamentals, upbeat Q4 earnings and supportive policy measures all adding to the bullish sentiment on Dalal Street, analysts noted.

The market rally got a boost from positive developments on the global trade front. Investor sentiment turned optimistic after US President announced three-month pause on reciprocal tariffs on April 9, with China being the only exception.

This move made Indian exports to the US relatively more competitive, attracting investor interest in export-oriented sectors, analysts said.

Adding to the momentum was the visit of US Vice President JD Vance to India. Vance’s four-day diplomatic visit, which included a meeting with Prime Minister Narendra Modi, focussed on strengthening economic and geopolitical ties between the two countries. Market participants are hopeful that the visit will pave the way for a bilateral trade deal, potentially boosting trade flows.

Commerce Minister Piyush Goyal’s visit to Europe and the United Kingdom for trade negotiations has also added to the upbeat sentiment, indicating that government is actively pursuing multiple trade partnerships amid a global push towards de-risking supply chains.

Banking stocks surge

The ongoing market rally has been powered by sharp up move in the banking stocks. The Nifty Bank index has soared over 11% in the past six sessions, fuelled by strong quarterly earnings.

HDFC Bank, India’s largest private sector lender, posted net profit of ₹17,616 crore in Q4 FY25, a 6.6% increase over the previous quarter and its net interest income rose by 10.3% to ₹32,066 crore. ICICI Bank also delivered strong earnings reporting an 18% annual rise in profit to ₹12,630 crore. Their smaller peer YES Bank surprised investors with 63% jump in net profit to ₹738 crore, signalling a broader recovery in the banking sector.

The Reserve Bank of India's (RBI) move to relax the liquidity coverage ratio (LCR) norms further boosted fortunes for banking stocks. The RBI on Monday decided to assign an additional 2.5% liquidity buffer for internet and mobile banking-enabled deposits,, down from the previously proposed 5%. Analysts believe this move will ease liquidity pressures and support banks’ operational efficiency.

Foreign fund inflows

Renewed interest from foreign institutional investors (FIIs) has been another key factor. Declining crude oil prices, a weakening US dollar and softening domestic inflation have made Indian equities more attractive to global investors seeking stable returns in emerging markets.

According to market experts, the recent correction in global markets due to trade war concerns and volatile commodity prices has made India an appealing alternative, given its stable economic outlook and strong corporate performance.

Quarterly earnings season

Investors have been buoyed by a robust start to the March quarter earnings season. Banks have led the charge with double-digit profit growth, while analysts expect other sectors like auto and capital goods to showcase steady performance in Q4.

Policy support from RBI

The RBI’s recent circular on LCR norms signals a more accommodative regulatory approach, aimed at addressing digital banking risks while ensuring liquidity support for banks. The revision in guidelines reflects a careful balancing act protecting the banking system while promoting digital adoption and innovation, an independent market expert Kunal Harsh said.