Nifty Extend Gains For 4th Session; NSE Reclaims $5 Trillion Market Cap

Indian equity markets started the week on a positive note, with the Nifty 50 index extending its recovery for a fourth consecutive trading session on Monday, September 21. Buying in index heavyweights and a decline in crude oil prices provided support, even as geopolitical developments in the Middle East and activity surrounding the NSE IPO remained in focus.

The Nifty 50 opened at 23,330.20 and slipped briefly to an intraday low of 23,314.80. Buying gradually picked up thereafter, taking the index above the 23,400 level around midday. The benchmark touched an intraday high of 23,466.80 before giving up part of its gains towards the close.

The Nifty eventually settled at 23,414.30, higher by 67.90 points or 0.29%, marking its fourth consecutive session of gains. The Sensex climbed 564.03 points, or around 0.76%, to close at 74,858.99. Reuters also reported that bargain buying after the market's recent decline, along with softer crude oil prices, supported Indian equities during the session.

The Bank Nifty, however, lagged the headline indices and ended only 0.02% higher. Meanwhile, the India VIX declined over 1% to around the 11.3 level. 

Broader Markets Fail to Participate

Despite gains in the frontline benchmarks, the broader market ended slightly lower.

The Nifty Midcap 100 declined 0.29%, while the Nifty Smallcap 100 slipped 0.07%. 

Overall NSE market breadth was also slightly negative. Out of 3,705 stocks traded, 1,735 advanced, 1,858 declined, while 112 remained unchanged.

During the session, 125 stocks touched fresh 52-week highs, while 103 stocks hit 52-week lows. Around 182 stocks were locked in upper circuits, compared with 86 stocks in lower circuits.

Nifty Pharma and Nifty Realty Gained Over 1%; Nifty Metal Remained Under Pressure

Sectoral performance was largely positive, with eight of the 11 key sectoral indices closing higher.

The Nifty Pharma index gained 1.16%, extending its winning run to a third consecutive session. Of its 20 constituents, 13 ended higher.

Realty shares also remained firm during the session.

In contrast, the Nifty Metal index declined 0.61%, ending a three-session rally. Selling was relatively broad-based within the index, with nine of its 15 constituents closing lower.

NSE Reclaims $5 Trillion Market-Cap Mark

The combined market capitalisation of companies listed on the National Stock Exchange (NSE) reclaimed the $5 trillion mark on Monday as gains in benchmark indices lifted overall market valuations. The recovery came after Indian equities had slipped below the milestone amid a sharp rise in crude oil prices and US bond yields last week.

Falling Crude Oil Prices Support Sentiment

One of the key supportive factors for Indian equities was the decline in international crude oil prices. Brent crude fell more than 2% during the session as markets assessed the possibility of diplomatic progress involving the US and Iran, along with an improvement in Saudi crude shipments. Brent traded around $101 per barrel, while WTI slipped below $99 per barrel.

Lower crude prices are generally supportive for India because the country imports a large proportion of its oil requirements. A decline in prices can ease concerns around the import bill, inflation and the rupee.

Geopolitical risks, however, remained on investors' radar. US President Donald Trump warned Iran of severe economic consequences and raised the possibility of a change in leadership if an agreement was not reached, while Iran's military warned of retaliation against further attacks. Trump also indicated willingness to meet Iranian President Masoud Pezeshkian during the United Nations General Assembly.

NSE IPO Remains in Focus

Primary market activity also remained in focus as the National Stock Exchange of India IPO entered its final day of bidding on Monday.

The approximately $2.3 billion IPO, entirely an offer for sale by existing shareholders, had already achieved full subscription by Friday. The issue opened on September 17 and closed on September 21.

Heavy primary-market activity has remained an important factor for domestic liquidity, particularly after several weeks of weakness in the secondary market.

Rupee Ends Marginally Higher

The Indian rupee also benefited from the decline in crude oil prices. The domestic currency closed marginally stronger at around 95.80 per dollar, compared with 95.87 in the previous session.

Softer oil prices and portfolio flows, including those associated with the NSE IPO, supported the currency. However, dollar demand from importers, particularly oil refiners, restricted further appreciation.

The August 2027 dollar-rupee forward premium declined by 6 paise to ₹2.94, as traders reassessed expectations surrounding domestic and global interest rates.

At the same time, expectations of another US Federal Reserve rate increase have strengthened. Markets were pricing in around a 55% probability of a Fed rate hike in October, compared with 42.5% a week earlier, according to CME FedWatch data cited by Reuters.

European Markets Trade Firmly Higher

Global equity sentiment remained supportive during European trading hours.

At around 4 pm IST, Germany's DAX was trading at 25,590.37, up 293.93 points or 1.16%. The UK's FTSE 100 advanced 99.69 points or 0.94% to 10,758.82, while France's CAC 40 gained 79.29 points or 0.98% to 8,144.31.

The broad-based rise in European markets came alongside falling crude oil prices and stronger global equity sentiment.

US Stock Futures Signal Positive Opening

US equity futures were also trading higher ahead of the opening on Wall Street.

Dow Jones futures stood at 52,449, gaining 370 points or 0.71%. S&P 500 futures advanced 52.75 points or 0.68% to 7,765.25, while Nasdaq 100 futures led the gains, rising 327.50 points or 1.09% to 30,244.75.

The positive futures trend was supported by lower oil prices and improved sentiment around diplomatic developments. Other market reports during European hours also showed all three major US index futures trading higher, with technology-heavy Nasdaq futures outperforming.