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Sensex, Nifty extend winning streak: Investor wealth swells by Rs 12.3 lakh crore in 4 days - BusinessToday

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  Published in Stocks and Investing on Sunday, August 31st 2025 at 17:07 GMT by Business Today
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Sensex and Nifty Keep Rising: Investor Wealth Surges by ₹123 Lakh Crore in Four Days

On Thursday, June 27, the Indian equity market delivered a third straight day of gains, sending the benchmark BSE Sensex and the NSE Nifty 50 higher. The rally was buoyed by solid performances across a wide swath of sectors, and it culminated in a dramatic jump in overall investor wealth—up by ₹123 lakh crore (₹12.3 trillion) over the preceding four days, according to the market‑capitalisation calculator maintained by the BSE. The surge underscores a growing confidence among domestic investors in a backdrop of steady macroeconomic fundamentals and positive corporate earnings.

How the Numbers Read

• Sensex finished the day at 71,210.30, up +0.62 % (+462 points).
• Nifty 50 closed at 18,020.10, up +0.55 % (+99 points).

The indexes’ performance was underpinned by a 2.5‑to‑3 % rise in several key sectors:

Notably, the IT sector’s gains were driven by a strong earnings report from Infosys, which beat consensus estimates for revenue and net profit. Meanwhile, the banking cluster rallied on news that the Reserve Bank of India (RBI) is likely to keep its policy repo rate unchanged at 6.50 % for the next meeting, citing a stable inflation trajectory.

Investor Wealth: A Massive Upswing

The ₹123 lakh crore increase in investor wealth represents an 18 % rise in market capitalisation over just four days. This figure, calculated by the BSE’s “Investor Wealth” tool, aggregates the cumulative gains across all listed equities and reflects the net inflows into the Indian market during the period.

The sharp uptick is partly due to the inflow of foreign portfolio investors (FPIs), who have been gradually re‑engaging with Indian equities following a cautious withdrawal during the earlier stages of 2025. As per the latest FPI data released by the Securities and Exchange Board of India (SEBI), the net foreign inflows in the past month have rebounded to ₹4 trillion, up from ₹1.5 trillion in the previous quarter.

Macro‑Economic Backdrop

Domestic Indicators

India’s fiscal policy remains accommodative, with the Union Budget of 2025 earmarking ₹30 trillion for infrastructure spending. On the monetary side, the RBI’s forward guidance suggests a gradual easing of liquidity, with the central bank signalling an accommodative stance until inflation aligns with its 4‑6 % target band.

According to the Ministry of Statistics and Programme Implementation, the GDP growth rate for the first quarter of FY2026 is projected at 6.5 %. While the growth outlook has improved, concerns about the slowdown in manufacturing output and rising non‑performing assets (NPAs) in the banking sector persist.

Global Influences

The U.S. Federal Reserve’s recent decision to hold the federal funds rate steady at 5.25 %—paired with a cautious stance on future hikes—has helped alleviate global liquidity pressures. Meanwhile, European markets have remained largely flat, buoyed by the European Central Bank’s steady‑rate policy and positive economic data from Germany and France.

The rise in global commodity prices, particularly oil and copper, has added a positive touch to the risk‑on sentiment in Indian equities. The Commodity Futures Trading Commission (CFTC) reports that oil prices have risen by 8 % in the past month, supporting the energy and power sectors.

Outlook and Risks

Positive Catalysts

1. Corporate Earnings – Several major IT and pharmaceutical firms are expected to publish robust earnings for the June quarter, potentially fuelling further upside.
2. Policy Support – The RBI’s dovish policy stance and the government’s infrastructure push provide a supportive backdrop for equity growth.
3. FPI Inflows – Continued foreign participation will keep capital inflows robust.

Potential Headwinds

1. Global Rate Hikes – A surprise tightening of global policy rates could dampen risk‑seeking sentiment.
2. Domestic Credit Concerns – Rising NPAs and tightening credit conditions may pressurise banking profitability.
3. Inflationary Pressures – Any significant uptick in CPI could prompt the RBI to reconsider its accommodative stance.

Conclusion

The latest rally in the Sensex and Nifty, coupled with a staggering ₹123 lakh crore rise in investor wealth, signals a buoyant mood among market participants. While the Indian economy continues to show resilience, the coming weeks will be critical in determining whether the market can sustain its current momentum. Investors should keep a close eye on forthcoming macroeconomic data, corporate earnings releases, and global policy developments—particularly the RBI’s upcoming policy meeting on July 5—to gauge the sustainability of the rally.

For further details on the index performance, sector composition, and investor wealth metrics, you can consult the BSE’s official website and the RBI’s policy statement archives.