After nearly 14 months of waiting, the Sensex finally crossed the 86,000 mark for the first time during Thursday morning trading. The last major milestone came on September 24, 2024, when the index touched 85,000 after a sharp rally that had begun in December 2023. During those 10 months, the Sensex surged from 68,000 to 85,000, a gain of 17,000 points, or almost 25 per cent.
But the journey after that was far from smooth. Over the next 14 months, the Indian stock market moved up and down sharply. The Sensex swung between a low of 71,425 in April 2025 and a high of 85,978 in late September 2024. Many global and domestic factors influenced these wild movements, especially the political and economic shifts that followed Donald Trump’s return to global politics after his November 2024 election win. His repeated warnings of tariffs on several countries, including India, created uncertainty and fear among investors.
Despite all these challenges, the Sensex reaching an all-time high again shows strong investor confidence and steady growth in the Indian economy.
To understand how the Sensex moved from 85,000 to 86,000, it is important to look at the major forces that shaped the market over these 14 months. This period was marked by global uncertainties, domestic economic reforms, crude oil price changes, shifting interest rate expectations, and constant geopolitical tension. Yet, India’s economic fundamentals remained solid, supported by lower inflation, cheaper Brent crude, and falling domestic interest rates.
Global Trade Worries and Crude Oil
One of the biggest pressures on the market was the rise in trade tensions under the Trump administration. Investors were nervous about tariff threats on Indian goods and fears of tougher visa rules for Indian IT professionals. When Trump imposed a 50 per cent duty on some Indian exports, the market reacted sharply, particularly in export-driven sectors. Concerns over possible higher tariffs on pharma and IT services also led to sell-offs.
Crude oil prices added to the pressure. Higher oil prices increase India’s import bill and raise costs for many industries. Whenever global tensions rose — such as during conflicts in the Middle East or uncertainty around the Russia-Ukraine war — crude prices jumped, hurting market sentiment. But recently, oil prices have eased, helped by hopes of peace and by reports, including one from JP Morgan, predicting that global oil oversupply may bring prices down to around USD 30 per barrel by 2027.
Meanwhile, rising US bond yields and fears of higher US interest rates caused foreign investors to pull money out of Indian stocks between September and early November 2024. Riskier emerging market assets became less attractive during that period. However, the US Federal Reserve is now hinting at possible rate cuts, which may improve foreign inflows into India.
Domestic Signals and Policy Delays
Inside India, some delays in economic reforms created small pockets of concern. Reforms such as simplifying GST and amendments to the Insurance Bill took longer than expected. But now the government has moved ahead, planning to introduce these Bills in the upcoming Lok Sabha session. The RBI’s growth forecast of 6.5 per cent and falling inflation have also supported confidence.
One major positive has been strong domestic participation. Indian investors continued pouring money into equity mutual funds, with monthly SIP contributions crossing Rs 29,000 crore. This steady inflow helped cushion the market even when global investors were selling.
Corporate earnings were slower than expected in some sectors, adding to the volatility. But with expectations of strong third-quarter results and possible positive geopolitical developments — like progress in the India–US trade deal and a potential end to the Russia-Ukraine war — the outlook is becoming more hopeful.
What investors should watch out for
Despite the new highs, experts are urging investors to stay cautious. The rally remains narrow, meaning only a few stocks are driving the index up, while many mid-cap and small-cap stocks are still weak or correcting. Analysts advise against chasing expensive or overvalued stocks out of FOMO. Instead, they recommend waiting for corrections and focusing on strong, fundamentally sound companies. According to Tapse, the next phase of growth will depend on earnings recovery, stable global conditions, and steady domestic flows. A selective and quality-focused investing approach is likely to work best at this stage.