Benchmark index Nifty rallied a whopping 2.5% on November 5 to reclaim the psychologically important 24,500-mark as oil prices slid on hopes that a Democratic victory in the US midterm elections could hasten the end of the US-Israeli war on Iran.
Market sentiment was also bolstered by signs that foreign investors were returning to India. Foreign investors bought shares worth Rs 7,284 crore on Wednesday, as per provisional data.
This was one of their biggest single-day buys in India since October 2025 and adds to November's net inflows of $1.57 billion.
"The victory of Democrats, who are seen as favouring tighter regulations on AI, could propel foreign investors to look beyond this theme in the future and benefit markets like India," said Dharmesh Kant, head of equity research at Cholamandalam Securities.
Kant added that the Indian market is showing signs of recovering from two years of underperformance against most global peers, as stars seem to be aligning on key factors like crude oil prices and foreign flows.