Stock Market: Sensex rises 98 pts, Nifty above 26,250; M&M, Titian lead gainers

Domestic benchmarks Sensex and Nifty opened higher on Friday, extending the optimism seen after Thursday’s record highs. The mood, however, remained cautious amid mixed global signals and growing expectations of interest rate cuts by both the US Federal Reserve and the RBI in their upcoming policy reviews. Investors will also be watching India’s Q2 GDP numbers for fresh direction.

At 9:18 am, the BSE Sensex added 66.17 points, or 0.08 per cent, to 85,786.55 after gaining nearly 98 points in early trade, while the NSE Nifty50 climbed 14.90 points, or0.06 per cent, to 26,230.45, having briefly hit a day’s high of 26,251.75.  

Among Sensex constituents, M&M led gainers, rising 1.52 per cent to Rs 3737.65. Titan gained 0.50 per cent, while Tata Motors PV, Bajaj Finserv, and ICICI Bank climbed 0.51 per cent, 0.41 per cent, and 0.40 per cent, respectively.

Asian markets traded lower on Friday. At last check, Japan’s Nikkei 225 was down 0.04 per cent to 50,144.76, while South Korea’s KOSPI declined 1.12 per cent to 3,942.10. Hong Kong’s Hang Seng Index edged 0.14 per cent lower to 25,909.56.

On Thursday, the Sensex climbed 110.87 points, or 0.13 per cent, to close at 85,720.38 after briefly hitting a fresh record high of 86,055.86. The Nifty50 edged up 10.25 points, or 0.04 per cent, to finish at 26,215.55, having earlier scaled a new all-time peak of 26,246.65.

VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said the important takeaway from the new records set by Nifty and Sensex yesterday is that these are new records driven by a narrow rally  in a limited number of performing largecaps. 

“Despite the market at new highs, majority of retail investors, particularly the newbies who rushed into the market after the Covid crash in March 2020, are holding portfolios which show losses. This paradox is due to the retail investors’ obsession with smallcaps and their belief that smallcaps will outperform irrespective of their valuation. If retail investors have to participate in the rally expected in 2026, to be driven primarily by higher earnings growth, they will have to invest in largecaps and quality midcaps with  growth potential,” Vijayakumar said.

“Even though Sensex and Nifty touched new highs yesterday, the Nifty Smallcap Index is around 9 % below its peak. This huge underperformance is primarily due to the poor earnings growth and high valuations of this segment. Smallcaps, in general, are likely to continue underperforming, in the short- to medium-term,” Vijayakumar added.