The markets are on a reasonably strong footing in afternoon trade. The Sensex is up over 300 points in afternoon trade and the Nifty is cruising comfortably over the 25,850 mark. The small and midcaps too are seeing reasonable buying interest. The Nifty Midcap 100 is up 0.75% while the BSE Small Cap is up 0.3%.
According to market veteran Ajay Bagga, “Overall with positive outcomes from the RBI and the US Fed, Indian markets are well positioned for a year end upswing. Expectations are low from the present visit of a US Trade negotiation delegation. However, earnings should rebound in the December quarter on the back of a strong consumption impulse post the GST cuts of end September. Coupled with expectations from the Union Budget 2026 , that is a strong setup.”
4 reasons why the market is rising today
The Fed’s rate action is no doubt a sentiment positive but the markets are also expecting strong earnings going forward. Here is a quick look at the overall factors contributing to the gains today.
Investors looking for value bets
Ahead of the upcoming year-end holidays, may experts believe that investors are looking to invest in value buy. Market veteran, Deepak Jasani highlighted that the “Indian markets have risen on the back of bottom fishing after a spate of recent losses, slowing down of FPI sales even as the US Fed cut rates by 25 bps overnight. BFSI and stocks that were under selling pressure rose the most. Nifty needs to close above 25948 on Dec 11 to see acceleration in uptrend.”
Fed rate cut and positive global cues
The US Fed has cut rates b 25 bps. This is the third rate cut by the US Fed this year. From December last year to this September, the US Central Bank had held rates steady. However the rate cut was targetted to spur the economy, given the strains seen.
Oil prices retreat
International oil prices eased as investors shifted focus back to Russia-Ukraine peace talks and monitored potential fallout from a US seizure of a sanctioned tanker off the coast of Venezuela. Reuters quoted Emril Jamil, a senior oil analyst at LSEG and said, “The benchmarks settled higher a day earlier after the US said it seized an oil tanker off the coast of Venezuela, as escalating tensions between the two countries raised concerns about supply disruptions.”
So far, there has been minimum impact of the seizure on the market, but further escalation will impose heavy crude price volatility.
Earnings optimism
The growing optimism about earnings improvement in the upcoming quarters is another key factor bringing in a positive sentiment in the market. Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments said that “Along with the likely slowdown in IPOs in 2026, when earnings growth picks up as expected, the market will respond positively. Weakness in the market now presents buying opportunities in high quality stocks, particularly in largecaps and selectively in midcaps. The weakness in the broader market is likely to continue.”
Overall the street is hopeful of the earnings trajectory improving going forward. That along with the US Fed rate cut helped lift sentiment.