NetMock

Fortune Favours The Bold

NIFTY & Sensex Trends – Market Impact

by ·

Print Friendly, PDF & Email

3️⃣ NIFTY & Sensex Trends – Market Impact 📈

🔹 Introduction

The NIFTY 50 and Sensex are the two primary stock market indices in India. Sensex, maintained by the Bombay Stock Exchange (BSE), consists of 30 large-cap companies, while NIFTY 50, managed by the National Stock Exchange (NSE), represents 50 major stocks. These indices reflect market trends, investor sentiment, and economic performance.

The stock market in 2025 has been influenced by global economic slowdowns, RBI monetary policy, corporate earnings, and geopolitical factors. A rise in Foreign Portfolio Investments (FPI) and an increase in retail investor participation have contributed to market volatility.

🔹 Key Trends in NIFTY & Sensex (2025)

✅ Stock Market Growth & Corrections 📊

  • Sensex crossed 75,000 points, while NIFTY 50 touched 22,500 points, driven by IT, Pharma, and Banking stocks.
  • Market corrections occurred due to interest rate hikes, inflation fears, and geopolitical tensions.

✅ Foreign Portfolio Investments (FPI) & Domestic Investors 💰

  • Increase in FPI inflows from the USA, Singapore, and UAE.
  • Retail investors participation via mutual funds and systematic investment plans (SIP) hit record highs.

✅ Sectoral Performance & Growth Drivers 🚀

  • IT & Technology Stocks saw strong growth due to AI and cloud computing investments.
  • Banking & Financial Sector remained stable due to strong credit growth and RBI’s monetary policies.
  • Green Energy & EV Stocks gained momentum with government incentives for renewables.

✅ Government Policies & Market Regulations 🏛️

  • SEBI’s new IPO regulations to increase transparency.
  • Stock transaction tax changes impacted short-term trading strategies.
  • Privatization & Disinvestment of PSUs influenced market trends.

✅ Impact of RBI & Global Factors 🌍

  • Repo rate stability (6.5%) influenced stock valuations.
  • US Fed policies, crude oil prices, and global economic trends played a major role in market fluctuations.

🔹 Prelims Focus Areas

  • What are NIFTY 50 & Sensex? How are they calculated?
  • Difference between BSE & NSE
  • Foreign Portfolio Investment (FPI) vs. Foreign Direct Investment (FDI)
  • Impact of RBI Monetary Policy on Stock Market
  • Role of SEBI in regulating Indian Stock Markets

📌 MCQs on NIFTY & Sensex Trends (2025)

1️⃣ What does NIFTY 50 represent in the Indian stock market?

A) Top 50 companies of the Bombay Stock Exchange (BSE)
B) Top 50 companies of the National Stock Exchange (NSE)
C) Top 30 companies of the National Stock Exchange (NSE)
D) Top 50 foreign companies listed in India

Tap here for Answer
Answer: B) Top 50 companies of the National Stock Exchange (NSE)

Explanation:

  • NIFTY 50 is the benchmark index of the National Stock Exchange (NSE), representing the top 50 companies across different sectors.
  • Sensex, on the other hand, consists of 30 large-cap companies listed on BSE.

2️⃣ Which regulatory body oversees the stock market in India?

A) Reserve Bank of India (RBI)
B) Securities and Exchange Board of India (SEBI)
C) Ministry of Finance
D) NITI Aayog

Tap here for Answer
Answer: B) Securities and Exchange Board of India (SEBI)

Explanation:

  • SEBI (Securities and Exchange Board of India) is the regulatory authority that supervises and regulates the Indian stock market.
  • It ensures transparency, investor protection, and fair trading practices.

3️⃣ How does an increase in Foreign Portfolio Investment (FPI) impact the stock market?

A) It leads to a decrease in stock prices
B) It increases liquidity and boosts stock prices
C) It has no impact on the stock market
D) It reduces the market capitalization of companies

Tap here for Answer
Answer: B) It increases liquidity and boosts stock prices

Explanation:

  • Foreign Portfolio Investments (FPI) involve overseas investors buying stocks in Indian companies.
  • Higher FPI inflows increase liquidity, leading to higher stock prices and market capitalization.
  • However, FPI outflows can cause market corrections and volatility.

4️⃣ What is the primary method used to calculate the Sensex and NIFTY indices?

A) Market Capitalization-Weighted Method
B) Equal Weighting Method
C) Free-Float Market Capitalization Method
D) Stock Price Averaging Method

Tap here for Answer
Answer: C) Free-Float Market Capitalization Method

Explanation:

  • Sensex & NIFTY are calculated using the Free-Float Market Capitalization Method.
  • This method considers only the shares available for public trading, ignoring promoter-held shares.

5️⃣ Which sector contributed the most to NIFTY & Sensex growth in 2025?

A) Real Estate
B) Information Technology (IT)
C) Textiles
D) Heavy Engineering

Tap here for Answer
Answer: B) Information Technology (IT)

Explanation:

  • The IT sector drove stock market growth due to global demand for AI, cloud computing, and digital transformation.
  • Infosys, TCS, and Wipro were among the top performers in NIFTY IT Index.

🚀 Conclusion

The NIFTY 50 and Sensex are key indicators of India’s economic health and investor sentiment. FPI inflows, RBI monetary policy, global factors, and sectoral growth trends determine market movements. The IT, banking, and renewable energy sectors were the biggest contributors in 2025.

This structured content provides Prelims-relevant material along with 5 MCQs to reinforce learning. Let me know if you’d like the next topic in the same format! 🚀😊

You may also like...