Benchmark Indices Rally for 2nd Day on Positive Global Cues

Mumbai: Indian equities extended their recovery for a second consecutive session on Tuesday supported by a rally in metal and auto shares and a positive trend in the global markets and bargain hunting by global investors.

The Sensex jumped 568 points or 0.75 per cent to close at 76,071, while Nifty 50 gained more than 172 points or 0.74 per cent to end the session at 23,581. The benchmark indices have recorded sharp gains this week so far, after a massive selloff last week.

Excluding Nifty IT and FMCG, all sectoral indices closed green, led by metal, auto, and realty. The Nifty IT index declined over 2 per cent on expectations of a delay in rate cuts and continued macro uncertainty in key markets like the US which are weighing on the earnings outlook for IT companies, despite supportive currency trends. Nifty Bank gained 463 points to close at 54,876 while Nifty Auto extended its rally from the previous session, rising over 2 per cent amid continued buying momentum.

On the Nifty, Eternal, Tata Steel, M&M, HDFC Life, and BEL emerged as top gainers, advancing between 2-6 per cent. BEL rose over 2 per cent after securing an order worth Rs 1,011 crore. On the other hand, Wipro, Cipla, and Tata Consumer Products faced the brunt of the selling pressure, ending as the day's top laggards.

Midcaps and Smallcaps mirrored the benchmark's strength. The Nifty Midcap 100 gained one per cent, while the Nifty Smallcap 100 rose 0.65 per cent. Market breadth turned positive after four days, with the BSE advance-decline ratio improving to 1.25, signaling broader participation. Twenty out of 30 companies of the Sensex closed in the green with gains while shares of 34 out of 50 companies of Nifty 50 closed with gains.

A key positive was the sharp decline in India VIX, which dropped nearly 8 per cent to sub-20 levels. The cooling in volatility, especially on derivatives expiry, accelerated theta decay and reduced the risk premium in options, allowing markets to stabilise after recent turbulence.

The Indian Rupee also continued its upward trajectory for the second day, appreciating by 5 paise to close at 92.37. The domestic currency found support from the equity markets recovery and strength in Asian currencies.

Nandish Shah deputy vice-president, HDFC Securities said, “ A double bottom formation on the intraday charts suggests further upside potential. On the higher side, 23,700 stands as the immediate resistance; a breach above this level could clear the path toward 23,835. Conversely, a decisive break below 23,300 would signal a resumption of the downtrend.”