Nifty 50 Holds Above 24,000; Sensex Gains 100 Points, IT Leads

On January 6, benchmark indices Nifty 50 and Sensex started the session on a positive note, buoyed by gains in the Consumer Durables and IT sectors, though public-sector bank stocks lagged behind.

As of 9:15 am IST, the Sensex climbed 94.07 points, or 0.12%, reaching 79,317.18, while the Nifty rose 23.30 points, or 0.10%, to 24,028.05. Market breadth reflected 252 stocks advancing, 132 declining, and 29 remaining unchanged.

Sectoral Performance

The Nifty IT index emerged as the top performer, gaining up to 1%, driven by advances in stocks like Tech Mahindra, LTIMindtree, and Infosys. Conversely, the Nifty PSU Bank index declined by more than 2%, with Union Bank, Central Bank, and Bank of Baroda experiencing losses of up to 6%.

Broader market indices were also under pressure. The Nifty Next 50 fell nearly 1%, while the Nifty Midcap 100 and Nifty Smallcap 100 indices shed up to 0.7%.

Market Drivers and Outlook

Market analysts suggest that with the holiday season behind, trading volumes are likely to pick up. Investors are expected to closely monitor corporate earnings for the October-December quarter for cues on market sentiment.

Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, noted that the earnings trajectory will be pivotal. "Third-quarter results are anticipated to be somewhat stronger than the first half of the fiscal year, with recovery from earlier disruptions such as erratic monsoons and political uncertainty," he stated.

In addition to earnings reports, investor attention will shift to the upcoming Union Budget 2025-26 and the RBI's February Monetary Policy Committee (MPC) meeting for further direction.

Global Market Sentiments

Global factors remain a headwind, with the dollar index at 109 and the 10-year US bond yield at 4.62%. Foreign Institutional Investors (FIIs) may continue their selling trend until bond yields fall and the dollar stabilizes.

Concerns over the Federal Reserve’s interest rate policies, inflationary pressures linked to President-elect Trump’s agenda, and rising oil prices could fuel volatility. Prashanth Tapse, Senior VP (Research) at Mehta Equities, highlighted the importance of monitoring post-inauguration policy shifts, as they could heavily influence market trends.

Technical Analysis

Technically, the Nifty 50 remains in an oversold zone, but there is potential for further downside to the 23,500 level, according to Sameet Chavan, Head of Research (Technical and Derivative) at Angel One. If this level is breached, a drop below 23,000 is possible. However, a breakout past the 24,800 resistance level could trigger a pre-budget rally.

Top Gainers and Losers

Key gainers on the Nifty 50 included Bajaj Finance, Bajaj Finserv, Titan Company, Shriram Finance, and Tech Mahindra. In contrast, Kotak Mahindra Bank, ONGC, Tata Steel, Cipla, and Hindalco were among the top decliners.

Shares of Kotak Mahindra Bank dipped over 1% to ₹1,808 following the resignation of Chief Operating Officer and Chief Technology Officer Milind Nagnur, who cited personal reasons for his departure.

Consumer goods major Dabur India Ltd. saw its shares slide 3% after releasing its business update for the October-December period. The company cited inflationary pressures in certain segments, partially offset by price adjustments and cost-control measures. "We anticipate flat operating profit growth in Q3," the company stated.