India's benchmark BSE Sensex breached the 92,000 level for the first time in history on Friday, gaining 1.8% to close at 92,184. The broader Nifty 50 climbed 1.9% to 28,127, also a record. The rally followed the Reserve Bank of India's decision Thursday to cut its policy repo rate by 25 basis points to 5.50%, the third cut in the current easing cycle, alongside a surprise change in stance from neutral to accommodative.
Foreign institutional inflows have totaled $4.8 billion month-to-date through April 25, on track for the strongest monthly inflow figure since November 2024. Year-to-date, foreigners have purchased a net $9.4 billion of Indian equities, reversing the entirety of 2025's $11.2 billion outflow as global allocators rotate back into Indian risk after a year of underperformance versus China and Korea.
IT Services and Banks Lead
IT services giant Tata Consultancy Services rose 3.2% to 4,512 rupees after reporting Q4 revenue ahead of consensus, while Infosys climbed 4.1% on raised full-year guidance reflecting strong Generative AI deal flow. The Nifty IT sub-index gained 3.4% on the session, supported by a softer rupee that helps export-oriented earnings.
Banking shares rallied broadly following the RBI decision. HDFC Bank gained 2.1%, ICICI Bank 2.4%, State Bank of India 3.1%, and Axis Bank 2.8%. Kotak Mahindra Bank surged 4.2% after disclosing a 28% year-over-year jump in Q4 net profit and improving asset quality with gross non-performing assets falling to 1.71%.
GDP Forecast Lifted
The RBI lifted its full-year GDP growth forecast to 7.4% from 7.0%, reflecting stronger-than-expected manufacturing PMI readings, robust services activity, and a record monsoon outlook from the India Meteorological Department. Inflation has moderated to 3.4% year-over-year, well below the 4% target midpoint, giving the central bank ample room to continue easing.
Morgan Stanley equity strategist Ridham Desai raised his year-end Sensex target to 98,000 from 92,500, while Goldman Sachs sees 95,000 in the base case. Risks flagged by both houses include a re-acceleration in food inflation and the political backdrop heading into key state elections in late 2026, though the broader macro setup remains supportive.