Indian Stock Market Surges as Democrats Win in US and Crude Prices Fall

The Indian stock market witnessed an unprecedented rally on Thursday, November 5, 2026. A significant surge was recorded in both the Sensex and Nifty indices, driven by the Democratic Party's major victory in the US midterm elections, enthusiasm in global markets, and a drop in crude oil prices. The main market indices opened near three-month highs and continued to rise throughout the day.

According to a report by Amer Ujala, the Sensex reached 79,424.52 in the afternoon session on Thursday, gaining 2,123.12 points, representing a significant increase of 2.74 per cent. Similarly, the Nifty saw a major jump of 610.96 points, closing at 24,571.55, up 2.55 per cent. This rally was clearly evident between 1:49 pm and 1:55 pm. According to NDTV, by 1:45 pm, the Sensex had risen by over 2,000 points and the Nifty by over 600 points, while at the close, the Sensex stabilised with a gain of 2,000 points and the Nifty with an increase of 576 points.

The primary reasons behind this market rally include the US midterm election results and the decline in crude oil prices. The Democratic Party achieved a major victory by securing a majority in the Senate and the House of Representatives, a result being described as a 'Blue Sweep'. This led to an atmosphere of optimism in global markets. According to The Hindu, the market received strong support as crude oil prices fell by 9 per cent. Brent crude prices declined for the fourth consecutive day to $93.82 per barrel.

A significant reason for the drop in crude prices is the potential reduction in conflict with Iran and the possibility of the Strait of Hormuz remaining open. According to The Hindu, Ahmad Hayat-Moghaddam, Vice Chairman of Iran's National Security and Foreign Policy Committee, stated that India, China, Iraq, and Qatar have been granted permission to pass through the Strait of Hormuz, allowing their tankers to navigate this critical waterway. Due to this development, crude prices reached a two-month low.

The Indian rupee also found relief amidst this rally. According to NDTV, the rupee strengthened by 29 paise against the US dollar to reach 94.36, compared to 94.65 on Wednesday. According to The Hindu, the rupee reached a two-week high and was trading at 94.38, up 0.15 per cent. However, the rupee's gains were limited by the demand for dollars from importers. The decline in the Dollar Index also supported the rupee, as the index hit a one-month low following the Democratic victory in the US.

Sector-wise, indices for the Auto and IT sectors saw increases of up to 4 per cent. According to Amer Ujala, investors engaged in heavy buying of shares in these sectors. Realty sector indices also recorded a 2 per cent increase. Nifty FMCG and Consumer Durables indices gained more than 1 per cent. The broader market also witnessed a rally, with the Nifty Smallcap 250 and Nifty Midcap 100 indices jumping 0.75 per cent.

Experts believe the reasons for this rally are both global and domestic. Ashwini Shami (President and Portfolio Management - Omniscience Capital) told NDTV that the results of a divided government in the US would improve global sentiment. Major supports for India include improvement in US yields, correction in AI shares, and a decline of over 15 per cent in crude prices (which have fallen below $95), creating a strong case for FII (Foreign Institutional Investors) allocations. He further added that lower crude prices would reduce the current account deficit, support the rupee, and lower commodity prices, thereby reducing margin pressure on various sectors. Banking, construction, and power sectors could benefit the most from this rally.

On the other hand, Anil Kumar Bhansali, Treasury Head of Finrex Treasury Advisors LLP, noted that the victorious win of the Democrats in the US has increased pressure on the dollar. Due to potential legislative hurdles in Washington, the possibility of an immediate recovery for the dollar is low, leading to the decline in the Dollar Index.

Prior to Thursday's rally, the market showed a positive trend on Wednesday, November 4, 2026. According to Amer Ujala, the Sensex closed at 77,219.65 on Wednesday, rising by more than 350 points, and the Nifty closed at 23,911.70, crossing the 23,900 mark. On Wednesday, the Sensex rose by 301.80 points (0.39 per cent) and the Nifty by 100.86 points (0.42 per cent). At that time, strength was seen in media and realty shares, while the Nifty IT index dipped into the red.

Global markets showed a mixed response on Thursday. Asian markets remained bullish, with benchmark indices in Japan and Australia rising. This pushed the MSCI Asia Pacific index up by 0.3 per cent. In the US, the S&P 500 index saw a strong increase of 1.6 per cent, the largest single-day gain in the last three months. The Nasdaq 100, comprising technology shares, also rose by 0.9 per cent. According to Amer Ujala, Hong Kong's Hang Seng rose by 1.3 per cent and the Shanghai Composite by 1.9 per cent, while Japan's Topix fell by 0.9 per cent and Euro Stoxx 50 futures closed with a decline of 0.4 per cent.

Midterm elections in the US are important elections held to select some members of the country's parliament. The main indices of the Indian stock market, Sensex and Nifty, are important tools for measuring the performance of the country's economy.