India’s Nifty 50 index has managed to recover from its losses in 2025, thanks to a resurgence in foreign portfolio investment (FPI) and increased bargain hunting activities. The National Stock Exchange of India’s Nifty 50 surged by 1.32% to reach 23,658.35 points, while the BSE Sensex also saw a rise of 1.4% to hit 77,984.38 points. Despite these gains, the Nifty is only up by 0.06% for the year, while the Sensex remains slightly down by 0.2%.

Experts like Narendra Solanki, the head of research at Anand Rathi, interpret this recovery as a sign that the market has weathered the storm and is now on a more stable trajectory. Factors such as decreasing inflation rates and improvements in industrial output have contributed to this positive sentiment, prompting investors to seek undervalued assets before the upcoming earnings season.

The recent six-day winning streak has seen both the Nifty 50 and Sensex climb by 5.6%, although they still lag behind their peak levels from late-September by around 10%. Notably, foreign portfolio investors, who had been consistently selling off Indian assets since late-September, reversed their stance and turned into buyers in three out of the last four sessions. This change in sentiment, especially in heavyweight financial stocks where FPIs have a significant stake, has been a driving force behind the market’s recent upswing.

The index’s Monday rally was largely led by financial stocks, with Kotak Mahindra Bank standing out with a 4.7% jump following the appointment of Bhavnish Lathia as the new chief technology officer. However, such rapid upward movements have also raised concerns about increased market volatility. The volatility index recorded a notable uptick to 13.7%, marking its most significant surge since January 6.

In a bid to mitigate the risk of a potential market correction, some investors have engaged in hedging activities. All major sectors experienced gains, with small-cap and mid-cap stocks showing increases of 1.1% and 1.3%, respectively. Among individual stocks, heavyweights like Reliance and HDFC Bank saw gains of around 2% and 1.7%, while automaker SML Isuzu surged by 4.5% on reports of a potential acquisition deal by Mahindra & Mahindra.

In conclusion, the recent resurgence of the Nifty 50 on the National Stock Exchange of India underscores the resilience of the market in the face of challenging conditions, with foreign investments and strategic buying decisions playing pivotal roles in driving the index back into positive territory for the year.