Stock market today: Nifty50 ends above 25,500; BSE Sensex up 1,000 points - top reasons for bull rally

Stock market today: Nifty50 and BSE Sensex, the Indian equity benchmark indices, rallied strongly in trade on Thursday. While Nifty50 went above 25,550, BSE Sensex surged over 1,000 points intraday. Nifty50 closed the day at 25,549.00, up 304 points. BSE Sensex ended at 83,755.87, up 1000 points or 1.21%.Indian benchmark indices showed significant gains on Thursday, primarily driven by strong performance in financial and metal sectors, as the US dollar weakened and Middle East tensions subsided.The Nifty Metal index advanced 1.5%, benefiting from the dollar's decline, which enhanced the affordability of dollar-denominated assets for other currency holders. Additionally, Nifty Bank and Financial Services indices recorded gains exceeding 1%.1. Weaker DollarUS President Donald Trump criticised US Federal Reserve Chair Jerome Powell as "terrible". He announced about evaluating three to four potential replacements for Powell before his 2026 term conclusion. Reports indicate Trump might take action in September or October.These statements generated uncertainty regarding the Federal Reserve's autonomy, causing the US dollar to decline. The dollar index decreased 0.69% to 97.00, whilst the US two-year Treasury yield reached a seven-week low of 3.764%.According to the CME FedWatch tool, traders currently estimate a 25% probability of a Fed rate reduction at the end-of-July meeting, up from 12.5% the previous week.2. Easing Middle East TensionsFollowing the ceasefire agreement between Israel and Iran, Indian financial markets have shown positive movement, as reduced geopolitical tensions have alleviated worries about oil availability and inflationary pressures. Given India's dependence on imported crude oil exceeding 80%, the lowered geopolitical risk contributes to a steadier inflation outlook and fiscal position.3. Declining Oil PricesFollowing the peak of Israel-Iran tensions, crude oil prices have decreased significantly. Brent crude futures declined to $67.57 per barrel, whilst US West Texas Intermediate (WTI) reduced to $64.84.Brent crude experienced a sharp 13% increase in mid-June, climbing from under $70 to reach $81.40 on June 23, driven by concerns about potential Iranian disruption of shipping through the Strait of Hormuz. The subsequent reduction in oil prices has benefited Indian equity markets by reducing both inflation and fiscal pressures.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)