Indian Stock Market Ends October Higher as IT Jumps 17.7%

Indian stock market ended October 2026 with the Nifty 50 up 1.9% and the Sensex up 2.7%, ending a two-month losing streak. The clearest driver was IT, whose sector index gained 17.7% during the month, its strongest monthly performance in more than six years.

Why did the market rise in October 2026?

The market rose as IT shares, resilient September-quarter earnings and hopes of long-term capital gains tax relief improved investor sentiment. The Nifty 50 closed October 30 at 23,053.10, up 0.51% for the day, while the Sensex gained 0.42% to finish at 74,459.53.

The final week also marked a notable reversal after a multi-week decline. The Nifty 50 gained 2.59% from 22,471.65 in the prior week, while the Sensex added 1,335.7 points, or 1.83%. Market commentary cited earnings that largely beat expectations without major negative surprises, alongside reports that the government may consider reducing long-term capital gains tax.

Which sectors and stocks led the market recovery?

IT led the market recovery, while pharma and healthcare produced the strongest gains in the final week. Nine of 16 major sectors rose during October, but the Nifty IT index stood out with its 17.7% increase. On October 30 alone, Nifty IT rose 2.32%, supported by buying in companies including Infosys, Tata Consultancy Services, HCL Tech and Tech Mahindra.

Pharma and healthcare also gained sharply in the week. The Nifty Pharma index rallied 6.10%, while Nifty Healthcare rose 6.08%, and pharma reached a record high on October 30. Sun Pharmaceutical Industries reported a 54.4% increase in standalone Q2 FY27 net profit to ₹871.3 crore, compared with ₹564.2 crore a year earlier.

Earnings reactions drove moves in several individual stocks. Trent rose 15.1% in October and jumped 5.44% on October 30 after reporting a 25% year-on-year rise in consolidated Q2 profit to ₹468 crore. Kotak Mahindra Bank gained 10.7% during the month after beating profit estimates, with brokerages pointing to faster loan growth and potential margin recovery.

What held back the market despite the benchmark gains?

The market's gains were uneven because broader shares, elevated crude prices and continued foreign institutional investor selling remained pressure points. Small-caps and mid-caps fell after reaching record highs in the previous two months, underlining that the benchmark advance was concentrated rather than broad-based.

The Nifty Smallcap 100 declined 4.2% in October, while the Nifty Midcap 100 fell 3.4%. Another measure, the Nifty Smallcap 250, was reported to have dropped nearly 6% for the month, its weakest showing in seven months. Banks, energy, FMCG and the broader market also showed weakness on October 30 even as headline indices extended their rise.

Crude oil remained a significant concern, with prices near $113 a barrel amid continuing Middle East tensions. Higher energy costs affected sentiment and corporate outlooks, particularly for fuel-sensitive businesses. InterGlobe Aviation narrowed its quarterly net loss to ₹1,879 crore from ₹2,582 crore as revenue rose 25.9%, but warned that higher airfares were unavoidable because of rising fuel expenses.

How did quarterly earnings influence market sentiment?

Quarterly earnings supported the market because several major companies delivered results that investors viewed as resilient, even though outcomes differed widely by company. The late-October earnings calendar included Reliance Industries, HDFC Bank, ITC, Sun Pharma, Ambuja Cements, Dixon Technologies and GAIL.

Reliance Industries traded at ₹1,171.70 on October 29, up 1.14%, before falling 0.92% to ₹1,157.95 on October 30 as investors assessed its oil-to-chemicals and Jio performance. Adani Ports reported an 18% rise in consolidated September-quarter net profit to ₹3,682.44 crore, helped by higher revenue. Coal India missed second-quarter profit expectations as higher costs offset robust demand, while Godrej Consumer Products posted profit marginally below estimates amid elevated commodity-linked input costs.

Ambuja Cements illustrated the variation within the earnings season. Its consolidated net profit fell about 84% to 90% year on year to roughly ₹114 crore, attributed to a tax reversal effect, despite a 10% increase in revenue. The mixed company-level results did not derail the broader earnings narrative, which was that the September-quarter reporting season had avoided major negative surprises.

Conclusion

October's gain showed that the market could recover after two weak months when IT momentum, better-than-feared earnings and policy hopes aligned. The Nifty 50 and Sensex closed the month higher, but the decline in smaller shares and pressure from energy prices indicated that participation across the market remained limited.

The next focus will be whether the earnings response remains constructive as results from major companies are assessed, and whether reports around long-term capital gains tax relief develop further. Investors will also watch crude oil, foreign investor activity and whether the weakness in small-caps and mid-caps persists.