Sensex and Nifty Surge on AI Earnings Optimism as Global Markets Find Stability amid Mixed Asian Signals

Sensex and Nifty Surge on AI Earnings Optimism as Global Markets Find Stability amid Mixed Asian Signals​

Indian equity markets are poised for a positive start, continuing their winning streak as optimism surrounding Artificial Intelligence (AI) fuelled earnings filters down from Wall Street to domestic investors. The domestic indices closed firmly in the green, buoyed by strong institutional support and stabilizing crude oil prices, despite volatility observed across various Asian exchanges.

The Sensex gained 521.16 points, advancing to 78,285.07, while the Nifty rose 159.50 points, closing at 24,430.35. The market continued its fourth consecutive session of gains. GIFT Nifty was noted trading at 24,545 around 8:00 am, indicating a likely positive momentum carry into the next session.

Wall Street Rally Drives Tech Confidence in Global Markets​

Global markets presented a mixed picture overnight, but U.S. equity performance provided significant support to the technology sector. The Nasdaq Composite climbed 1.12 percent to finish at 26,121.16. The S&P 500 rose 0.72 percent, reaching 7,537.43, and the Dow Jones Industrial Average advanced by 0.29 percent to 53,055.91.

The optimism is primarily rooted in expectations of robust earnings seasons across U.S. corporations, driven by sustained demand for AI infrastructure. Chipmakers, notably Broadcom, rallied strongly as investors reinforced confidence in the technology sector following recent market volatility.

Asian Markets Show Caution Despite Record Profit Forecasts​

Despite a positive trend in U.S. markets, Asia experienced caution. MSCI’s broadest index of Asia-Pacific shares outside Japan slipped 0.73 percent. Japan's Nikkei declined by 1.08 percent, and South Korea's Kospi dropped 4.1 percent. This caution occurred even as Samsung Electronics forecasted a record second-quarter operating profit, suggesting some degree of pre-profit booking across the region.

U.S. equity futures also tempered expectations in early Asian trade, with Nasdaq 100 futures edging down 0.7 percent.

Commodity Prices and Institutional Inflows Boost Market Tone​

Crude oil prices edged higher but remained near levels preceding geopolitical tensions involving Iran, providing crucial macroeconomic support for import-dependent economies like India. Brent crude futures rose modestly by 0.39 percent to around $72.3 a barrel. West Texas Intermediate crude saw a gain of 0.26 percent, trading at about $68.8 a barrel.

Institutional activity remained highly supportive of the domestic market. Foreign institutional investors (FIIs) continued as net buyers for the second straight day, injecting ₹243 crore into equities. Domestic institutional investors (DIIs) also maintained buying momentum, investing ₹3,791 crore.

Technical Outlook and Market Stability Factors​

Ponmudi R, CEO of Enrich Money, attributed the improved market sentiment to easing geopolitical tensions and softer-than-expected U.S. labour market data, noting that this has successfully elevated risk appetite. He stated that the current consolidation of crude oil prices in the $68-$69 per barrel range continues to lend support to India's macroeconomic forecast.

The Nifty maintains a positive technical structure after sustaining above the 24,400 level. Immediate resistance is identified in the 24,450-24,500 zone; breaching this area could pave the way toward 24,600. On the downside, 24,200 acts as the initial key support, followed by the critical 24,000 level. However, he cautioned that the rupee remains under pressure.