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The benchmark equity indices Sensex and Nifty traded over half a per cent higher on Friday; Know key reasons
Why is Market Rising Today?
Why Is Stock Market Rising Today? The benchmark equity indices Sensex and Nifty traded over half a per cent higher on Friday, tracking firm global cues and buying interest in index heavyweights.
At the close, the BSE Sensex settled at 85,762.01, up 573.41 points or 0.67 per cent, while the NSE Nifty50 ended at 26,328.55, gaining 182 points or 0.7 per cent. The Nifty touched a fresh intraday high of 26,332.15 during the session.
On the Sensex, NTPC, Trent, Bajaj Finance, SBI and Power Grid emerged as the top gainers, while ITC, Kotak Mahindra Bank, Axis Bank and Bharti Airtel finished in the red.
Broader markets also saw healthy gains, with the Nifty Midcap 100 rising 1.01 per cent and the Nifty Smallcap 100 advancing 0.72 per cent.
Sectorally, Nifty Auto, Metal, PSU Bank, Realty and Consumer Durables indices climbed over 1 per cent each, reflecting strong buying beyond frontline stocks. Nifty FMCG was the only laggard, slipping 1.19 per cent.
What Is Driving The Markets Higher?
1) Global markets lend support
Asian equities were largely positive, with South Korea’s Kospi, Shanghai’s SSE Composite and Hong Kong’s Hang Seng trading in the green. US futures were also up as much as 0.7 percent, pointing to a firm opening for Wall Street later in the day.
2) Strength in heavyweight stocks
Buying interest was concentrated in large-cap names, with Reliance Industries rising nearly 1 percent for the second straight session.
“The monthly sales data from auto companies as well as business updates from other sectors signal a likely improvement in December quarter earnings, lifting markets,” G Chokkalingam, Founder and Head of Research at Equinomics Research, told Reuters.
3) Support from domestic institutions
Consistent buying by domestic institutional investors (DIIs) provided a cushion to the market.
“Steady domestic institutional inflows continue to provide broader support, helping offset aggressive selling by foreign investors,” said Ponmudi R, CEO of Enrich Money.
Chokkalingam added that a positive earnings season, followed by a favourable Union Budget and a potential trade agreement with the US, could act as key triggers for markets after the consolidation seen in 2025.
4) Rupee shows mild strength
In the currency market, the rupee traded in a narrow range and appreciated 6 paise to 89.92 against the US dollar. Forex traders said the USD/INR pair is expected to remain range-bound, with the RBI defending the 90 level, even as foreign fund outflows persist.
5) Auto stocks extend rally
The automobile sector played a key role in lifting the markets. The Nifty Auto index advanced for the fourth straight session, rising nearly 1 per cent to 28,732.65 and hitting a fresh intraday high of 28,808.40.
Mahindra & Mahindra and Maruti Suzuki led the gains after reporting strong December sales numbers. Passenger vehicle sales touched a record 45.5 lakh units in 2025, marking a nearly 6 per cent increase over the previous year. Growth was driven by higher disposable incomes, GST-related benefits, demand for second vehicles, and increasing preference for customised offerings.
Maruti Suzuki posted a robust 22 per cent jump in sales, while Mahindra & Mahindra and Tata Motors Passenger Vehicles overtook Hyundai Motor India in market share, highlighting a shift in the competitive dynamics of the auto sector.
VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said the strong 25.8 per cent year-on-year growth in passenger vehicle sales in December reflects healthy economic momentum, though its sustainability at a slower pace will be crucial for future earnings growth.
Market technicals
Devarsh Vakil, Head of Prime Research at HDFC Securities, said a sustained move above the 26,234 level could indicate a breakout from the ongoing consolidation and pave the way for a retest of record highs. He added that 25,900 is likely to act as immediate short-term support for the Nifty.
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January 02, 2026, 13:08 IST
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