The Sensex and Nifty 50 opened flat on October 8 but quickly turned positive, driven by gains in banking and construction stocks. However, the metal and IT sectors witnessed sharp declines.
At 9.55 AM, the Sensex was up 316 points or 0.4 percent at 81,366 and the Nifty was up 86 points or 0.4 percent at 24,882. About 1,945 shares advanced, 1,152 shares declined, and 101 shares remained unchanged.
Nifty Bank rebounded nearly 1 percent, snapping a six-day losing streak. HDFC Bank, ICICI Bank, and Axis Bank led the recovery, climbing between 1-2 percent. Nifty Infra also rose half a percent after having declined for the past five sessions. Indian Hotels and Tata Power led the gains in the index. Tata Power shares rose over 2 percent after Nomura initiated a 'Buy' call on the stock with a target price of Rs 560.
"It is difficult to comment on the sustainability of the up move in the indices at this stage because we need to see broader market participation, which hasn't happened yet," said Ajit Mishra, SVP of Research at Religare Broking. "The bounce is mainly in selective, oversold stocks, leading to this recovery. Sustainability will only be confirmed if Nifty decisively crossed the 25,000 mark. Until then, it's uncertain whether the recovery will gain strength.
Metal stocks dropped over 2 percent following a decline in SGX iron ore prices. Tata Steel, Hindalco, and JSW Steel led the decline in Nifty Metal. IT shares, which had surprisingly resisted the broader sell-off in the previous session, also slipped 0.8 percent.
In the broader market, both BSE Midcap and BSE Smallcap rose by nearly a percent.
"Technically the Nifty index is anticipated to exhibit volatility, maintaining a predominantly bearish outlook," said Centrum Broking. "Market trends suggest a 'sell on rise' strategy as long as it remains below 25,000. On the downside, critical support levels are identified at 25,700, 25,590, and 25,400."
On the Nifty 50, Tata Steel, JSW Steel, Tata Motors, Hindalco, and Titan led the losses, sliding between 2 - 5 percent. In contrast, Axis Bank, HUL, HDFC Bank, UltraTech Cement, and SBI emerged as top gainers, rising 1-2 percent.
Most Asian shares fell today, but Chinese stocks surged as they marked a strong return from the Golden Week holiday, supported by recent stimulus measures from Beijing. However, the positive sentiment didn't spread across other Asian markets, with Hong Kong pulling back after its recent rally.
In the US, Wall Street's major indexes fell about 1 percent overnight, pressured by rising oil prices and higher Treasury yields. Concerns over the Middle East conflict's impact on oil further dampened market sentiment.
The minutes from the Federal Reserve's September meeting, set for release on October 9, will be closely watched for insights into future rate-cut strategies. On October 10, the consumer price index data will also be key as the data could impact the Fed's monetary policy decisions.
In the domestic market, the primary focus is on September quarter earnings and maintaining stability in fund flows.
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