Sensex, Nifty hold gains after record open as energy, bank stocks lead
Out of the 13 sectoral indices, 11 traded in the green. Nifty IT and Nifty Private Bank were the only laggards, declining 0.6 percent and 0.1 percent, respectively.
The Sensex and Nifty 50 remained in positive territory around noon on September 23, after hitting fresh all-time highs at the opening. Gains were driven by energy, banking, and auto stocks, while IT stocks lagged.
Around noon, the Sensex was up 190 points or 0.2 percent at 84,741, while the Nifty 50 was up 87 points or 0.3 percent at 25,878. Both benchmarks have consistently reached new highs since the US Federal Reserve’s 50-basis-point rate cut on September 18. Today, the Sensex touched a record high of 84,881, while Nifty 50 peaked at 25,925.
The ongoing rally is fueled by optimism over policy stability following national elections in June and strong growth prospects for India. Additionally, expectations of a soft landing for the US economy and rising foreign institutional investor (FII) inflows have further bolstered investor confidence.
In the broader market, the BSE Midcap index was up 0.4 percent, while the Smallcap index gained 0.7 percent. Meanwhile, the India VIX, a key volatility measure, rose 5 percent to 13.4.
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Sectoral Trend
Out of the 13 sectoral indices, 11 traded in the green. Nifty IT and Nifty Private Bank were the only laggards, declining 0.6 percent and 0.1 percent, respectively.
On the other hand, Nifty Auto, Nifty Oil & Gas, and Nifty PSU Bank led the gains, rising 1-3 percent.
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Fundamental View
“Nifty now appears to be moving to its next target of 26,000,” said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services. He said that the move towards the 26,000 target is likely to be led by the banking majors which are showing strong momentum.
According to Vijayakumar, two factors are favouring banking stocks. A) The FIIs who were major sellers early this year have turned into buyers and they are likely to buy more banking stocks which are even now fairly valued in this highly valued market. B) The credit-deposit gap which has been impacting banks’ margins has started narrowing.
“In brief, accumulation is likely in banking stocks and this has the potential to push the market up,” Vijayakumar said.
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Technical View
Mandar Bhojane, Derivative Analyst at Choice Broking sees the immediate support for Nifty 50 at 25,400 and 25,200. “These levels present potential buying opportunities for investors,” he said.
“If Nifty can sustain above the 25,800 mark, it could further rally toward 26,000 and 26,400 this week, reinforcing the bullish trend,” he added.
Key Nifty gainers
BPCL, Bajaj Auto, M&M, SBI, ONGC
Key Nifty losers
Wipro, Infosys, HCLTech, Eicher Motors, ICICI Bank
Key Sensex gainers
Tata Steel, Kotak Mahindra, Bharti Airtel, M&M, SBI
Key Sensex losers
IndusInd Bank, Wipro, Infosys, HCLTech, ICICI Bank
Stock moves
SpiceJet: Shares zoomed up to 10 percent after the airline raised Rs 3,000 crore by selling shares to qualified institutional buyers (QIBs), offering a significant boost for the struggling low-cost carrier.
Mahindra and Mahindra: Share rose over 2 percent to a hit fresh record high after Goldman Sachs maintained its ‘buy’ recommendation on the counter and raised the target price to Rs 3,400, indicating an upside potential of 15 percent from the last close of Rs 2,951 on the National Stock Exchange (NSE).
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