Indian benchmark indices ended over 1% higher on Monday, with the BSE Sensex soaring over 1,000 points and the Nifty50 closing above 24,300. The rally was driven by heavyweight Reliance Industries after it reported better-than-expected earnings, while continued foreign inflows further boosted market sentiment.

The 30-share BSE Sensex jumped 1,005.8 points, or 1.27%, to settle at 80,218, while the broader NSE Nifty gained 289 points, or 1.2%, closing at 24,328.

The total market capitalization of BSE-listed companies rose by Rs 4.45 lakh crore, reaching Rs 426.03 lakh crore.

All sectoral indices, except Nifty IT, ended in the green. The Nifty Auto, PSU Bank, Metal, Pharma, Realty, Healthcare, and Oil & Gas indices saw gains ranging from 1% to 3%.

Here are top reasons behind today's market rally:

1) Better than expected RIL Q4 results

Reliance Industries rose 4% after reporting a fourth-quarter profit that exceeded estimates, driven by strong performances in its retail and digital businesses. Reliance's performance alone contributed nearly 300 points to the Sensex rally.

Brokerage firm Nomura highlighted robust results across segments and identified three near-term triggers: scaling up the new energy business, potential tariff hikes for Jio, and a possible IPO or listing for Jio that could unlock further value for Reliance.

JP Morgan also indicated that Reliance shares could rise in the near term due to attractive valuations.

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2) Sustained FII buying

A major contributor to market resilience is the sustained buying by Foreign Institutional Investors (FIIs), which has amounted to Rs 32,465 crore over the last eight days.

"FIIs have dramatically reversed their selling strategy and turned sustained buyers. This shift is driven by the relative underperformance of US stocks, bonds, and the dollar. In a weakening US economy and depreciating dollar environment, FIIs may continue to buy, providing further support to the market," said VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited.

3) Weakening Dollar

A falling dollar has also bolstered investor sentiment in emerging markets like India. A weaker dollar typically encourages foreign inflows and supports the rupee.

On Monday, the dollar index stood at 99.60, down from 109.88 in early February. This decline has lifted appetite for risk assets, particularly in sectors like metals that are sensitive to currency movements.

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4) Crude Impact

Crude oil prices traded below $67 a barrel on Monday, easing inflation concerns. Brent crude was around $66.06, while U.S. West Texas Intermediate was at $63.34. Lower oil prices are favorable for India, a major oil importer, helping ease pressure on the current account and inflation.

5) Global Market

Indian indices also surged in line with other Asian peers. Early market action was light, with MSCI's broadest index of Asia-Pacific shares outside Japan edging up 0.1%. Japan's Nikkei rose 0.9%, while South Korea firmed 0.2%.

EUROSTOXX 50 futures added 0.3%, while FTSE futures and DAX futures both rose 0.2%.

Meanwhile, U.S. President Donald Trump has claimed progress in trade negotiations with China and other countries, though tangible evidence remains scarce.

"It is important to remember that markets have an uncanny ability to surprise by climbing many walls of worries," said Vijayakumar.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)