Benchmarks Sensex and Nifty pared their losses on July 20 due to various reasons, including better-than expected Juen quarter results by ICICI Bank and Reliance Industries.

At 10:22 am, the Sensex was down 456.26 points or 0.58% at 77,695.19, and the Nifty was down 109.40 points or 0.45% at 24,224.90. About 1,822 shares advanced, 1,488 shares declined, and 198 shares were unchanged.

Key reasons behind market paring losses

1) Strong RIL results

Mukesh Ambani's Reliance Industries beat market expectations for first-quarter net profit, driven by strong performances across its oil-to-chemicals, retail and telecom businesses.

"We maintain our SOTP-based target price at Rs 1,619. Q1FY27 reinforces our constructive view as O2C captured a greater share of the strong refining product cracks, Jio maintained predictable double-digit EBITDA growth and its DRHP filing improved visibility on value unlocking. The upside from higher O2C and Digital Services estimates is offset by near-term pressure on Retail margin, elevated finance costs, and execution risks around New Energy and O2C project commissioning," said Elara Securities, which has a 'Buy' rating on the stock.

Goldman Sachs maintained its 'Buy' rating on Reliance Industries stock with a target price of Rs 1,870, implying about 41% upside from Friday's closing price. The brokerage said core EBITDA for the April-June quarter was broadly in line with expectations, with the O2C business performing better than anticipated despite elevated crude oil prices. It expects the earnings outlook to become more constructive in the September quarter. The brokerage highlighted RIL’s upcoming commissioning of its fully integrated solar photovoltaic and battery manufacturing facilities as a key catalyst.

Nomura also reiterated its 'Buy' rating with a target price of Rs 1,690. It said Reliance delivered a record quarter, driven by a sharp improvement in O2C crack spreads, with strength in the energy business more than offsetting weakness in retail. The brokerage said that O2C EBITDA climbed to a four-year high of about Rs 17,000 crore, while exploration and production EBITDA improved to around Rs 5,000 crore. Jio's revenue growth was supported by subscriber additions and higher average revenue per user (ARPU), although Nomura said recovery in retail margins remains a key monitorable.

2) Strong ICICI Bank results

ICICI Bank, which analysts described as the sector's strongest performer, rose 1% after a Q1 earnings beat, with JPMorgan citing stronger NII growth, margin resilience and robust asset quality. The stock was the top gainer on the private bank index.

3) Technical reason

Analysts said as long as Nifty stays above 24,150, markets could see bullish momentum.

"Friday’s range breakout followed multiple days of lacklustre trades with successive days of decline in trading range. A triangle formation thereof was also supportive, but we are not convinced that this has marked the beginning of a sustainable uptrend. We see 24400 posing a challenge today, but dips are expected to be bought as long as above 24140. That said, we will wait for direct rise past 24600 to look beyond the ongoing consolidation and plan for a new record peak," said Anand James, Chief Market Strategist, Geojit Investments Limited.

"The Nifty has formed a bullish candle on the weekly chart while maintaining a higher-bottom formation on the daily chart, suggesting that the broader trend remains positive. We believe the 24,000/77,000 zone (20-day SMA) and 24,200/77,600 will be the key trend-deciding levels for positional traders. As long as the market trades above these levels, the bullish sentiment is likely to remain intact, with the potential to extend the rally towards 24,500-24,600/78,500-78,800. However, a move below 24,200/77,600 could weaken sentiment, and traders should consider reducing long positions in such a scenario. Our strategy would be to lighten weak long positions in the 24,400-24,500 zone, while a decisive close above 24,600 would reinforce the positive medium-term outlook," said Shrikant Chouhan, Head Equity Research, Kotak Securities.

Going ahead, the immediate trading range for Nifty is expected between 24,100 and 24,500, said Sachin Gupta, VP – Research, Technical Research, at Choice Broking Private Limited.

4) Value buying

Value buying emerged at lower levels after Sensex fell over 700 points and Nifty hit an intraday low of 24,150 on July 20. Sensex rose 250 points from day's low while Nifty reclaimed the pscyologically important 24,200-mark.