Indian equity benchmarks staged a sharp opening rally on Thursday, 5 November, with the BSE Sensex jumping 1,609.54 points or 2.08% to open at 78,910.94 and the Nifty50 climbing 417.45 points or 1.74% to 24,378.05, tracking strong global cues after the US midterm election outcome and a near-10% plunge in crude oil prices. All sectoral indices began the session in positive territory, with broad-based buying across financials, realty, IT, and energy.

Sectoral Leaders

Nifty Private Bank surged more than 2% to lead sectoral gainers, while Nifty Realty climbed 1.86%. Nifty Cement, Nifty Auto, Nifty IT, Nifty Oil & Gas, and Nifty PSU Banks all advanced up to 1.82%. FMCG, consumer durables, metal, media, and chemicals also traded higher, rising between 1% and 1.5%.

Technical Setup and Market Signals

Market analysts noted that the Nifty continued to hold above the critical 200-day exponential moving average (EMA) near 23,904, reinforcing a constructive technical structure. The RSI climbed to 68.55, signalling strong near-term momentum, though analysts cautioned that the possibility of profit booking cannot be ruled out at these levels. Immediate support is seen in the 24,000–24,200 zone, with resistance placed between 24,500 and 24,700.

Global Cues: US Elections and Crude Oil

The overnight catalyst was a decisive Democratic sweep of both chambers of Congress in the US midterm elections, which cleared a significant overhang of political uncertainty. The Dow Jones Industrial Average jumped more than 3% in its strongest post-midterm election performance in over four decades, while the S&P 500 and Nasdaq Composite each rose more than 1.4%. Separately, Brent crude tumbled nearly 10% to settle below $100 per barrel, easing inflationary pressures that had weighed on emerging markets. The benchmark US 10-year Treasury yield retreated to around 4.89%, further supporting appetite for risk assets. Easing geopolitical concerns surrounding Iran and a weaker US dollar added to the positive sentiment.

FII and DII Activity

On Wednesday, foreign institutional investors (FIIs) extended their buying streak for a fourth consecutive session, recording net equity purchases of ₹7,284 crore. Domestic institutional investors (DIIs), however, continued to pare holdings for a fourth straight day, posting net sales of ₹3,712 crore. The divergence between foreign and domestic flows suggests institutional repositioning rather than a uniform sentiment shift.

What to Watch

Market experts cautioned that once the initial euphoria around the US election result fades, attention will shift to the prospect of a prolonged political standoff in Washington, with US President Donald Trump reportedly more likely to assume a confrontational rather than a ceremonial role. Domestically, traders will watch whether FII inflows sustain past the initial reaction window and whether Nifty can break above the 24,500–24,700 resistance band on a closing basis.