The domestic equity benchmarks rebounded sharply on Monday, with the Sensex rallying over 2,300 points and the Nifty climbing past the 24,700-mark, as easing geopolitical tensions between India and Pakistan and positive US-China trade talks lifted investor mood. This is the biggest single-day rise in the last 11 months.

Sensex jumped 2,376.18 points or 2.99 percent to hit an intraday high of 81,830.65, while the NSE Nifty gained 729.8 points or 3.03 percent to touch 24,737.80.

Adani Enterprises, Jio Financial Services, Trent, Shriram Finance, and Axis Bank were among the top gainers in today's trading session.

Here are the key factors behind the stock market rally today

1) India-Pak ceasefire: India and Pakistan on Saturday announced reaching an understanding to stop all firings and military actions on land, air, and sea, with effect from 5 pm that day. This came after India launched 'Operation Sindoor' on May 7 to destroy nine terror infrastructures in Pakistan and Pakistan-Occupied-Kashmir in retaliation for the Pahalgam terror attack.

"The de-escalation between India and Pakistan removes a key overhang on investor sentiment and is likely to be seen as a major positive development by financial markets. Historically, markets have responded positively to such geopolitical cooling," said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.

2) US-China Trade Talks: The conclusion of high-level trade talks between the US and China in Switzerland further buoyed the investor sentiment. Both countries signalled progress, with US officials pointing to a possible deal aimed at narrowing the American trade deficit, while Chinese authorities spoke of an "important consensus".

China’s Vice Premier He Lifeng said a joint statement would be issued in Geneva on Monday, and Vice Commerce Minister Li Chenggang hinted at “good news for the world.”

3) Strong global cues: In Asian markets, South Korea's Kospi, Shanghai's SSE Composite index, and Hong Kong's Hang Seng were quoting higher while Japan's Nikkei 225 index traded marginally lower. Ahead of the expected joint statement from Geneva, U.S. futures were up over 2 percent, signalling global optimism over a resolution to the trade dispute between the world’s two largest economies.

4) Nifty IT zooms: IT stocks gained on Monday on hopes of a US-China trade deal after positive talks in Switzerland. Oracle Financial Services Software, Persistent Systems, Coforge, Mphasis, and Infosys gained up to 6 percent intraday.

What did technical analysts say?

Anand James, Chief Market Strategist at Geojit Investments, said "Though we certainly did not expect a vertical bounce back, we did go in last Friday expecting a consolidation rather than outright break down, given the support offered by the 200 day SMA near 24050, as well as fibo support near 23950-870."

"Even as Nifty closed in the red on Friday, with weekend uncertainty looming, 62% of its constituents bounced at least 196 from their respective lows, suggesting that most of the damage was limited to the downside gapped opening. This is contrary to usual bear moves, where a dead cat bounce is usually followed by a powerful plunge. That another wave of downside did not unfold on Friday is an indication of resilience, or that a good deal of certainty has been priced in already. This sets up for a bounce with a least objective of 24260 and an optimistic objective of 24770-850. However, should we fail to see past 24590, or if 24150 fails to hold after an upswing, expect resumption of downtrend aiming 23670-460," he added.