Nifty recovers 0.5% as FII buying, global cues support market

The Nifty index demonstrated resilience in the session, recovering 0.5 percent to settle at 24,334 after trading at lower levels during intraday activity. According to reports, the recovery was underpinned by positive global cues and foreign institutional investor buying activity. The buying interest emerged ahead of the options expiry period, a typically volatile phase in market cycles. The index managed to reverse earlier losses with support from external market strength and domestic institutional participation.

Multiple tailwinds supported the broader market recovery. Brent crude oil prices declined 3.2 percent, easing inflationary concerns that have weighed on emerging market sentiment. The Indian rupee strengthened by 24 paise against the US dollar, signaling relative strength in the domestic currency. India VIX, the volatility gauge that measures market fear and uncertainty, fell 3.9 percent to 11.08 levels, indicating declining anxiety among traders and investors.

For market participants, this recovery pattern reflects a shift in risk sentiment. The combination of cooling oil prices, currency strength, and declining volatility typically supports equity valuations by reducing stagflation risks and external headwinds. The FII buying activity suggests foreign investors viewed valuations favorably at lower levels. Traders should monitor whether this support sustains beyond the expiry period and if global sentiment remains constructive, as external factors continue to drive emerging market flows and domestic benchmark indices.

Source: Markets-Economic Times