FMCG Leads Rally as Indian Markets Close Higher on FII Buying

Domestic equities staged a recovery on Friday after opening on a subdued note, with benchmark indices ending firmly in positive territory. The NSE Nifty 50 rose 156.80 points, or 0.65 per cent, to close at 24,353.55, while the BSE Sensex gained 504.86 points, also up 0.65 per cent, to settle at 78,493.54.

The turnaround was largely attributed to improving geopolitical sentiment and renewed buying by foreign institutional investors (FIIs), which helped offset early-session weakness.

How did global and geopolitical factors influence sentiment?

Market participants closely tracked developments in West Asia, where signs of de-escalation lifted investor confidence. Analysts pointed to easing tensions as a key factor supporting risk appetite.

Vinod Nair, Head of Research at Geojit Investments Limited, said, “The domestic market closed the day higher, supported by improving prospects of a Middle East resolution and a reversal in FII flows into net buying. A ceasefire between Israel and Lebanon helped keep crude below USD 100 per barrel, easing pressure on import-dependent economies.”

He added that currency stability also played a role, noting that the rupee strengthened during the session due to measures by the Reserve Bank of India and softer geopolitical tensions.

Which sectors drove the rally?

The rally was broad-based, with all sectoral indices on the NSE ending in the green. The standout performer was the FMCG pack, as the Nifty FMCG surged 2.65 per cent. Gains in this segment were supported by price hikes, strong business updates, and relatively attractive valuations.

Other sectors also contributed to the upward momentum. The Nifty Media climbed 1.39 per cent, while the Nifty Metal rose 1.06 per cent. Banking and real estate stocks saw moderate gains, with the Nifty PSU Bank advancing 0.70 per cent and the Nifty Realty rising over 1 per cent. The Nifty Auto posted marginal gains of 0.20 per cent.

What role did commodities play in market movement?

Commodity trends offered additional relief to investors, particularly on the inflation front. Brent crude prices remained on a downward trajectory, trading at around USD 96 per barrel, which is seen as supportive for an import-dependent economy like India.

Meanwhile, gold prices stayed largely flat at Rs 1,53,173 per 10 grams for 24 karat, indicating stable safe-haven demand. Silver prices, however, rose by 1.46 per cent to Rs 2,52,220 per kilogram, reflecting some strength in industrial demand.

How did global markets perform?

Despite gains in Indian equities, global cues remained mixed. Most Asian markets ended lower, reflecting cautious sentiment among investors.

Japan’s Nikkei 225 declined by more than 1 per cent, while Singapore’s Straits Times Index slipped 0.20 per cent. Hong Kong’s Hang Seng Index fell 0.75 per cent, Taiwan’s Taiwan Weighted Index dropped 0.89 per cent, and South Korea’s KOSPI declined 0.55 per cent.

What should investors watch next?

While easing geopolitical tensions and FII inflows have supported the current rally, market experts caution that the ongoing Q4 earnings season will be crucial in determining the near-term direction of equities.

Corporate performance and forward guidance for FY27 are expected to shape investor sentiment, even as global uncertainties and commodity price movements continue to influence the broader outlook.

(With inputs from ANI)