Indian benchmark indices rebounded on Tuesday, led by a sharp rally in information technology stocks after better-than-expected results from HCLTech and as fresh Reserve Bank of India measures to support the rupee improved sentiment.

The Nifty 50 rose 1.60% to 22,721.95, while the Sensex gained 1.54% to 73,033.78, recovering from Monday's losses. Finance Minister Nirmala Sitharaman's comments that she was open to hearing market participants' views on long-term capital gains tax and securities transaction tax also supported sentiment.

The Nifty IT index jumped 5.2%, its biggest one-day gain in more than 17 months, although it remains down 21.2% year to date amid concerns over moderating earnings growth and AI-driven disruption to traditional software services.

HCLTech surged 8.4%, its biggest daily gain in more than six years, after stronger-than-expected quarterly results reflected improved profitability and deal wins. Tata Consultancy Services and Shriram Finance were also among the top Nifty 50 gainers. Fifteen of the 16 major sectoral indices advanced, with Nifty Realty and Nifty Consumer Durables also rising, while Nifty Pharma declined. The Nifty MidCap 100 gained 1.06%, while the Nifty SmallCap 100 rose 0.11%.

The rupee strengthened for a second consecutive session after the RBI introduced further measures to ease pressure on the currency, with likely intervention in the spot market amplifying the gains. It rose as much as 95.0725 per US dollar in early trade before trimming gains to close at 95.28, up 0.5% from the previous session. The measures helped the rupee outperform its regional peers.

Indian government bond yields fell as traders covered short positions, while easing crude oil prices and US Treasury yields supported sentiment. The benchmark 6.94%, 2036, bond yield declined to 7.3655% from 7.3857% on Monday. The RBI accepted the full 250-billion-rupee offer at its open-market operation bond sale auction, although cutoff prices varied from poll estimates across securities, indicating uneven demand.

Top Movers of the Day

HCL Technologies surged 8.42% to 1,326.00 rupees, leading the market rally as the company reported a 21% year-on-year growth in its net profit and a 12% year-on-year growth in its revenue.

Tata Consultancy Services advanced 6.79% to 2,269.30 rupees, tracking the widespread upward momentum across the technology sector after strong July-September quarter results.

Shriram Finance jumped 6.31% to 988 rupees, following a Bloomberg report that said Japan’s Mitsubishi UFJ Financial Group is exploring a move to gain majority control in the NBFC.

Tech Mahindra climbed 4.93% to 1,543.50 rupees, continuing the trend of strong performance among large IT caps. The share price rose today ahead of its July-September quarter results, which will be announced on October 15.

Infosys gained 4.13% to 1,062.10 rupees as investors heavily favoured major software exporters during the session after the strong July-September quarter results of tech companies.

Hindustan Unilever rose 3.01% to 1,875.50 rupees, supported by renewed buying activity in the fast-moving consumer goods sector.

Bajaj Auto added 2.83% to 10,318 rupees as the automobile major benefited from the broader positive market sentiment fuelled by easing crude oil prices.

Divi's Laboratories fell 1.50% to 9,285.00 rupees, facing stock-specific profit booking in the pharmaceutical sector despite the largely positive market.

Kotak Mahindra Bank declined 0.99% to 439.00 rupees, recording a slight dip due to mild selling pressure that bucked the broader market rally.

Max Healthcare Institute dropped 0.57% to 861.00 rupees, weighed down by minor corrections in select healthcare names.

Maruti Suzuki India slipped 0.62% to 11,245.00 rupees due to growing concerns that geopolitical tensions in West Asia could push up commodity and raw material prices putting pressure on near-term profitability.

Futures & Options
The Nifty October 2026 futures closed at 22,860, a premium of 138.05 points over the Nifty 50's cash-market close of 22,721.95. The Nifty 50 surged 358.60 points, or 1.60%, during the session, while the NSE's India VIX, a gauge of expected near-term volatility, fell 7.94% to 14.04.

Tata Consultancy Services, Infosys and HCL Technologies were the most-traded individual stock futures contracts in the NSE's F&O segment. The October 2026 F&O contracts will expire on 27 October 2026.

Bonds
Indian government bond yields fell Tuesday on short covering, lower oil prices and softer US Treasury yields. The benchmark 6.94%, 2036 bond yield closed at 7.3655%, down from 7.3857%.

The RBI accepted the full 250-billion-rupee offer at its gilt sale, though varied cut-off prices signalled uneven demand. Most bonds priced above expectations, the 6.10% 2031 bond below, and no bids were accepted for the 7.10% 2034 gilt.

Thirteen states raised 300.05 billion rupees, which is less than the notified amount of 312 billion. Assam accepted 8.05 billion rupees of its 11-year bond, while Gujarat rejected all bids for its 12-year bond.

Forex
The rupee rose 0.5% to 95.28 per dollar Tuesday, outperforming regional peers after new RBI forex curbs and likely spot intervention. It touched 95.0725 as the RBI tightened rules on oil-related dollar demand, hedging, and derivatives.

The curbs may support the rupee by limiting dollar demand and speculation, though balance-of-payments pressures remain. They unsettled banks, widened forward spreads, and shifted activity to non-deliverable forwards. The dollar index fell 0.2% to 102.3, while oil headed for its first decline in nearly a week on the prospect of more Russian diesel supplies.

Crypto
The cryptocurrency market staged a tentative recovery on Tuesday, with Bitcoin trading above $83,500 after falling towards $81,000 amid heavy institutional outflows. Ethereum also recovered to trade slightly above $2,500. However, sentiment remained cautious ahead of Wednesday’s US consumer price inflation report, which could influence the near-term direction of risk assets.

US spot Bitcoin exchange-traded funds recorded $681 million in net outflows last week, their steepest weekly exit since mid-year, while traders trimmed exposure to riskier altcoins ahead of the data.

US Stock Futures
US stock futures were mixed Tuesday as investors awaited major bank earnings and assessed an Asian technology sell-off. S&P 500 futures were flat, Nasdaq-100 futures fell 0.5%, and Dow futures rose 375 points, or 0.7%, after UnitedHealth gained 3% on better-than-expected earnings.

Technology stocks weakened after South Korea’s Kospi fell 5.5% to its lowest since July 31 on valuation and Chinese competition concerns. Investors also watched US home sales and Fed remarks ahead of September inflation data that could shape yields and rate expectations.

US Treasury Notes
US Treasury yields fell Tuesday, with the 10-year yield down 5 basis points to 5.19%, retreating from a 24-year high earlier this month. Two- and five-year yields each fell 3 basis points, to 4.77% and 4.98%. Technology-stock weakness boosted safe-haven demand, while lower oil prices eased inflation concerns ahead of Wednesday’s US consumer price index report.

Investors await the inflation report for clues on Fed policy. Markets assign a 19% chance of an October 25-basis-point increase and nearly 72% for December. Persistent inflation could support further tightening, while softer data may ease pressure on yields.

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