Benchmark stock market indices closed higher on Wednesday, continuing the rally seen in the afternoon session, driven by the strength in IT stocks amid positive global sentiment, particularly in the US. The S&P BSE Sensex surged by 595.19 points to settle at 84,466.51, while the NSE Nifty50 added 180.85 points, closing at 25,875.80.
Vinod Nair, the Head of Research at Geojit Investments Limited, noted that global equities rallied due to renewed risk appetite, fueled by optimism surrounding the expected resolution of the US government shutdown and increasing expectations of early Fed cuts amid signs of a cooling US labor market. Emerging markets outperformed, reflecting the improved global sentiment. Indian indices followed suit, with large-cap stocks leading the gains, particularly in the automotive, IT, and pharmaceutical sectors. The positive market momentum was supported by favorable domestic macro fundamentals, including easing CPI and WPI inflation, a robust GDP outlook, and optimistic H2 earnings expectations.
Among the top gainers of the day, Asian Paints recorded a significant increase of 4.46%, followed by Tech Mahindra with a jump of 3.34%. Tata Consultancy Services advanced by 2.73%, Bajaj Finserv gained 2.42%, and Adani Ports added 2.14%, rounding off the top five gainers.
However, some stocks experienced selling pressure, leading to a slight dip in the broader market. Tata Steel was the most significant loser, dropping by 1.30%, followed by Tata Motors Ventures with a decline of 1.28%. Tech Mahindra Ventures fell by 0.79%, Bharat Electronics slipped by 0.64%, and Kotak Mahindra Bank edged down by 0.29%.
Rupak De, the Senior Technical Analyst at LKP Securities, mentioned that the Nifty index is maintaining its uptrend and displaying strength after a gap-up opening. The index has continued its upward movement following a retest of the falling channel breakout and has moved above the 21EMA, confirming the ongoing uptrend. In the short term, the sentiment is expected to remain positive, with the index potentially targeting 26,000. Immediate support is positioned at 25,700 on the downside.