Sensex, Nifty Extend Gains for Fifth Consecutive Session on March 21

Benchmark indices Sensex and Nifty continued their upward momentum for the fifth straight session on March 21, driven by a stronger rupee, a rebound in IT stocks, and fresh foreign fund inflows.

The Sensex surged 682.42 points, or 0.89 percent, to close at 77,030.48, while the Nifty gained 199.6 points, or 0.86 percent, settling at 23,390.25. Market breadth remained positive, with 2,561 stocks advancing, 931 declining, and 113 remaining unchanged.

Among the top gainers were Bajaj Finance, Nestle, Kotak Mahindra Bank, NTPC, Maruti, Power Grid, Adani Ports, Tata Motors, Reliance Industries, and Bajaj Finserv by Money Control.

Key Drivers of the Market Rally:

Stronger Rupee: The Indian rupee appreciated by 14 paise against the US dollar, opening at 86.2287 and later trading at 86.2337, compared to its previous close of 86.3675. This marks a two-month high and the best weekly gain for the rupee in over two years. The appreciation was supported by strong foreign investor inflows and a decline in the real effective exchange rate (REER), according to currency experts.

Foreign Portfolio Investor (FPI) Buying: After months of persistent selling, FPIs turned net buyers in two of the past four sessions. On March 20, FPIs purchased equities worth Rs 3,239.14 crore, while domestic institutional investors (DIIs) were net sellers, offloading shares worth Rs 3,136.02 crore, as per provisional data.

"The recent rally, which saw Nifty climb 3.5 percent this week, comes amid escalating trade tensions and looming reciprocal tariffs set to take effect on April 2. However, the main catalyst for this rally has been renewed FPI buying in the cash market," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

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Value Buying in Large-Cap Stocks: Analysts attribute the recent uptrend to value buying in large-cap stocks. "We are currently witnessing a relief or pull-back rally that could sustain until the Nifty reaches 23,300-23,500 levels, with large-caps trading at attractive valuations," said Shrikant Chouhan, Head of Equity Research at Kotak Securities, in an interview with Reuters.

With positive sentiment prevailing in the market, investors remain watchful of global trade developments and potential tariff implications in the coming weeks.