Indian Stock Markets Shine in October with Robust Growth

Mumbai – India’s stock markets witnessed a remarkable resurgence in October, marking their strongest monthly performance since March.

The benchmark indices, the Nifty 50 and the BSE Sensex, surged by 4.5% and 4.6% respectively, driven by solid corporate earnings, positive investor sentiment, and sustained foreign inflows.

The upbeat performance highlights renewed confidence in India’s economic outlook and resilience amid global uncertainty.

Although both indices closed slightly below their all-time highs reached in September 2024, the overall monthly performance reflects optimism in the country’s growth potential.

Market experts attribute this rally to stronger-than-expected corporate earnings, improved valuations, and the easing of inflationary concerns supported by stable monsoon conditions.

Despite a minor dip on the last trading day of the month, when the Nifty 50 fell by 0.6% to 25,722.1 and the Sensex declined by 0.55% to 83,938.71, the broader market momentum remained positive.

The temporary weakness was linked to adjustments in bank stock indexes following regulatory announcements.

India’s market regulator recently confirmed that bank stock indexes tied to derivatives contracts would undergo restructuring in phases by March 2026, leading to some short-term profit booking.

Even with this regulatory impact, analysts remain upbeat. According to G. Chokkalingam, founder and head of research at Equinomics Research, October was “a strong rebound month for markets, with corporate earnings meeting expectations and no major disappointments.”

He added that the cooling of valuations compared to September 2024 has reignited foreign investor interest, especially as India’s economic fundamentals remain strong and inflation stays under control.

Foreign institutional investors made a notable comeback, purchasing nearly $1.94 billion worth of Indian equities in October.

This reversed a three-month trend of outflows and underscored global investors’ confidence in India’s growth trajectory.

With a combination of stable macroeconomic conditions, a supportive policy environment, and growing global demand for Indian exports, the country continues to attract long-term capital inflows.

All 16 major sectors on the Indian exchanges recorded gains in October, showcasing the broad-based nature of the market rally.

The small-cap and mid-cap segments performed particularly well, with gains of 4.7% and 5.8% respectively, highlighting increased participation across market categories.

Sector-wise, financials, banks, and private lenders were among the top performers, posting gains between 4.3% and 6% during the month.

The strong results of leading lenders such as HDFC Bank and Axis Bank added to market optimism, reflecting a steady recovery in credit demand and stable asset quality.

The banking sector’s robust performance is expected to continue as India’s economy maintains its momentum in consumption and investment.

The information technology sector also posted a solid 6.1% increase in October, boosted by better-than-expected earnings from leading firms such as Tata Consultancy Services, HCLTech, and Wipro.

This performance indicates resilience in India’s technology services industry despite global economic headwinds and slowing IT spending in other markets.

Among individual companies, Reliance Industries led the rally with a 9% jump in October following a 10% rise in second-quarter profit.

The company’s strong performance across its energy, telecom, and retail segments reaffirmed its status as one of India’s most influential corporate powerhouses.

Other notable gainers included Titan Company, which rose 11.3% on robust festive-season demand, and Nestlé India, which gained 10.3% after delivering upbeat quarterly results in the consumer goods sector.

Overall, the October performance of Indian markets reflects renewed optimism among both domestic and global investors.

The consistent growth in corporate profits, combined with improving valuations and strong macroeconomic indicators, has positioned India as a leading investment destination in Asia.

Looking ahead, experts believe that India’s markets are likely to maintain their upward momentum, supported by strong earnings visibility, healthy liquidity, and policy stability.

The combination of solid fundamentals and increased investor participation is expected to keep the Nifty 50 and Sensex on a positive trajectory through the remainder of the financial year.