The primary catalyst for the rally was the performance of Reliance Industries, India’s most valuable listed company. The conglomerate’s shares rocketed 11.6% to approximately ₹1,300, lifting its market capitalisation above ₹17.59 lakh crore. Because Reliance carries one of the largest weightings in both the Sensex and the Nifty, its surge accounted for a substantial portion of the index gains. The stock’s ascent followed the release of its second-quarter fiscal 2026-27 results, which showed a 41% year-on-year increase in consolidated net profit attributable to shareholders, reaching ₹25,548 crore. This profit growth was driven by elevated refining margins in its oil-to-chemicals business. According to Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments, the move was further supported by delivery-based buying worth around ₹6,413 crore and short covering.
Beyond corporate earnings, a sharp decline in global crude oil prices provided a macroeconomic tailwind for Indian equities. Global crude traded around $108 a barrel during Indian hours on Monday, down from highs near $117 the previous week, with prices falling further later in the day on reports of possible US-Iran peace talks. As India imports the majority of its crude oil, lower energy prices are significant for the country’s trade balance, inflation trajectory, and currency stability. The Nifty Oil and Gas index jumped 5.95% on the day, while the Nifty Metal index rose 3.21%, with Tata Steel up 5.83% and JSW Steel up 5.13%. Coal India and Shriram Finance each added 4.88% to their valuations.
Investor sentiment was further bolstered by a shift in foreign institutional investor (FII) flows, which turned to buying after a period of outbound pressure. Analysts noted that a global rotation away from AI-linked stocks has redirected interest toward emerging markets like India. Additionally, speculation regarding a review of the long-term capital gains (LTCG) tax regime contributed to the positive outlook, although no policy change has been implemented. The Indian rupee also strengthened marginally, gaining approximately 0.12% against the US dollar to trade around 94.90, supported by the reduced cost of energy imports.
Despite the strong headline numbers, market breadth revealed a divergence in performance across market segments. While 2,445 stocks advanced on the NSE against 1,164 decliners, with 57 stocks hitting 52-week highs, the rally was concentrated in large-cap names. The Nifty MidCap 100 index declined 1.19% and the Nifty SmallCap 100 fell 0.71%, indicating that smaller companies did not share in the benchmark gains. Technology and media sectors also lagged, with the Nifty IT and Nifty Media indexes ending in negative territory. The India VIX, a measure of market volatility, edged up 1.37% to 15.51, suggesting that while sentiment was positive, uncertainty remained in specific sectors.
The momentum carried into Tuesday, November 3, with the Sensex trading at 76,400.68 in early trade, up 0.94%. The Nifty 50 advanced to 23,621.60. Analysts indicated that the 23,250–23,350 band on the Nifty should provide immediate support, with a hold potentially opening the way toward 23,600. The market’s next critical test will be whether the large-cap rally can broaden to include mid- and small-cap stocks, and whether the diplomatic developments regarding US-Iran relations will sustain the decline in crude oil prices.
