Sensex rises 0.65% as Reliance and financials offset late profit-taking

Indian equities recovered after four sessions of losses, but the advance narrowed sharply by the close. The session began with support from stronger global markets and lower US Treasury yields after Federal Reserve Governor Christopher Waller signalled that another rate increase might not be necessary if inflation pressures continue to ease.

Reliance Industries was a major contributor to the Sensex advance, while HDFC Bank and other financial stocks provided additional support. Traders attributed the improved tone to reduced expectations of an imminent US rate increase, although elevated crude prices and geopolitical uncertainty limited follow-through. The late retreat from the day's highs suggested that participants remained willing to take profits rather than extend risk aggressively.

Reliance Industries led the large-cap support after rising during the session. Business Standard reported that the company accounted for about a third of the Sensex's intraday gains at one stage, while brokerages Jefferies and Nomura had reiterated positive views on the counter on expectations of stronger FY27 earnings from its oil-to-chemicals business and firm petrochemical spreads.

Financial services also helped stabilise the benchmarks. HDFC Bank was cited as another major contributor, and insurance stocks were among the stronger pockets of the session. The market's response indicates that domestic liquidity continued to cushion the index even as foreign selling and the oil shock remained unresolved.

Metals benefited from the broader cyclical and infrastructure tone, with Tata Steel and other related counters among the stocks cited as gainers. By contrast, pharmaceutical and healthcare shares faced pressure, while telecom and internet counters lagged. Reports attributed some of the weakness in pharma to margin pressure and the broader retreat to profit-taking; the available material does not establish a single stock-specific trigger for the sector move.

The Reserve Bank of India remained active in the foreign-exchange market. Traders told the Economic Times that the central bank sold dollars during Friday's session, helping the rupee absorb the pressure from higher oil prices and weakness in some Asian currencies. The RBI's special FCNR(B) deposit-related facility had generated total foreign-currency inflows of $136.377 billion as of the latest reported update, supporting domestic liquidity and the currency.

The available material does not report a fresh CPI, IIP, GST, trade or PMI release on September 4. It also does not identify a new finance ministry measure announced during the session. A separate market report said SEBI was reviewing the pricing and settlement process for derivatives, but no final rule change was reported.

Global cues were supportive at the open and remained the main explanation offered for the rebound. Reuters reported that Asian shares tracked Wall Street higher after Waller's comments reduced rate-hike concerns; the US 10-year Treasury yield had eased and the dollar had weakened. The backdrop mattered for India because lower US-rate expectations reduce some pressure on emerging-market assets and improve the relative appeal of technology and financial shares.

Crude remained the principal counterweight. Brent held above $95 a barrel amid continuing US-Iran tensions, raising concerns about India's import bill, inflation and the rupee. The latest provisional institutional data available was for Thursday: foreign investors sold Rs 2,345.87 crore of Indian equities, while domestic institutions bought Rs 4,977.46 crore. That divergence helps explain why domestic buying could support the indices without fully reversing the market's recent caution.

Corporate news added stock-specific support in infrastructure and industrial names. Power Grid secured transmission bids with reported annual billings of Rs 4,396 crore, while Rail Vikas Nigam emerged as the lowest bidder for a Rs 404.88 crore East Coast Railway project. Sical Logistics received a Rs 534.73 crore Central Coalfields order for heavy earth-moving machinery, and Inox Wind secured a 100 MW turnkey wind-energy order from Indian Oil worth Rs 755 crore.

Cipla's subsidiary entered an exclusive licensing and supply partnership with Qilu Pharmaceutical for the US rights to the QL2107 Keytruda biosimilar. UltraTech Cement launched its Ultravolt wires and cables business with a planned investment of Rs 1,800 crore. Bharat Forge reported FY26 net profit growth of 19.3% year-on-year to Rs 1,089.4 crore and revenue growth of 11.2% year-on-year to Rs 16,811.65 crore; the available material does not provide a comparable consensus estimate, so the result cannot be described as a beat or miss.

Other reported developments included rating upgrades for IRFC, SAIL and HUDCO, the appointment of Sai Krishna Alluri as CFO of Shanthi Gears, and Great Eastern Shipping's commencement of a buyback of up to Rs 900 crore at a maximum price of Rs 1,530 per share. These announcements were relevant mainly to individual counters; no broader earnings surprise was identified in the available material.

The primary market remained active. ESDS Software Solution and Priority Jewels made strong debuts after heavily subscribed offerings, while Qualiance International opened for subscription. The simultaneous presence of large IPO premiums and continued block activity in Gland Pharma points to selective risk appetite rather than a uniformly broad market recovery.

For the next session, traders will weigh the US labour-market data against the continuing oil and geopolitical risks. In India, the key tension remains between domestic institutional support and foreign selling, with the rupee and bond market providing additional signals on how much of the global rate relief is translating into local risk appetite.