Global Markets Rally as AI Boom Drives Record Highs—What Investors Need to Know

Mumbai: Benchmark stock indices Sensex and Nifty 50 ended higher on Friday, 31 May 2026, halting a five-session slide as investors positioned ahead of India’s general-election exit polls and the release of fourth-quarter GDP data. The BSE Sensex rose 0.19 % to 76,815.47 while the NSE Nifty added 0.18 % to 23,432.60, reversing early weakness that had dragged both gauges to fresh weekly lows. Momentum improved mid-session after crude oil prices softened from intraday highs, easing worries about imported inflation and fiscal slippage. Traders also drew confidence from overnight strength on Wall Street, where the Dow Jones Industrial Average notched another record close above 50,600 amid resilient U.S. consumer-spending data. Among sectoral indices, Nifty Bank outperformed with a 0.7 % gain as heavyweight lenders caught a bid on expectations of robust credit growth in the April-June quarter. State Bank of India, HDFC Bank and ICICI Bank collectively contributed over 120 points to the headline index. On the broader market, the Nifty Midcap 100 and Smallcap 100 advanced 0.3 % and 0.5 %, respectively, indicating renewed risk appetite. Market breadth turned positive in the last hour: 1,278 stocks rose against 1,121 decliners on the NSE. Top gainers on the Nifty included Dixon Technologies (+4.5 %), Shriram Finance (+3.9 %), Axis Bank (+2.3 %), and ITC (+2.1 %) after technical analysts flagged fresh breakout patterns and strong derivative rollovers into the June series. Conversely, ONGC, Tata Steel and Hindalco slipped up to 1 % as metals and energy counters cooled with commodity prices. The India VIX fear gauge fell below 12, its lowest level in three months, signaling calmer sentiment despite the politically charged backdrop. Investors now await two catalysts that could dictate near-term direction: 1. Exit-poll results due after the market close, offering the first nationwide snapshot of voter sentiment before official vote counting on 4 June. A decisive mandate is generally viewed as supportive for policy continuity in infrastructure spending and tax reform. 2. March-quarter GDP figures scheduled for release at 18:00 IST. Consensus points to 6.9 % year-on-year growth, but a meaningful beat could stoke expectations of an RBI rate hike in August, tempering equity upside. Technical outlook: The Nifty 50 reclaimed the 20-day exponential moving average at 23,400 and formed a bullish hammer on the daily chart, suggesting the 23,250–23,280 zone may act as a near-term floor. Upside hurdles reside at 23,600 and the record high of 23,742. Traders should monitor foreign institutional investor (FII) flow, which turned marginally positive on Thursday after four straight sessions of net selling worth ₹7,800 crore. With event risk peaking and volatility compressed, analysts recommend a stock-specific approach, focusing on domestic consumption plays and capital-goods names that boast earnings visibility irrespective of election math.