New Delhi, Feb. 9 -- Markets are remarkably forgiving when the mood turns. Over the past few days, equity sentiment has staged a sharp turnaround. A relatively benign Union Budget 2026-27, improving global risk appetite, and two back-to-back trade deals with major economies have the potential to put animal spirits back on the table.

Meanwhile, this earnings season has thrown up an interesting development-a set of businesses whose financial turnarounds have arrived just as the market's mood has improved. That synchronization matters. When profits turn after a stock has already rerated, the payoff is limited. But when operational improvement coincides with a sentiment shift, markets tend to respond disproportionately.

That is the narrow l...