The benchmarks Nifty 50 and Sensex kicked off the day on a positive note and opened with strong gains on October 14. Information technology and metal names led gains in the market, while all sectors, barring media stood steady in the green.
At 09.47 am, the Sensex was up 485.94 points or 0.60 percent at 81,867.30, and the Nifty was up 143.50 points or 0.57 percent at 25,107.80. The market breadth also tilted in favor of gainers as about 17,88 shares rose, 1,357 fell, and 140 remained unchanged.
Despite the gains, caution lingers as the market followed a similar pattern last week—opening strong on most days but unable to sustain momentum by the close. Analysts pointed the heightened volatility in the market to consistent FII selling, expectations of sluggish Q2 earnings growth, geopolitical tensions, and China's stimulus.
Meanwhile, a slew of big bang earnings including those of HCLTech and index heavyweight Reliance Industries are also slated for later today, which will be closely tracked by market participants. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services believes that IT and banking stocks are likely to remain resilient on the back of expected good Q2 numbers.
However, he sees limited scope for the market to move up sharply from here as FY25 earnings expectations have been downgraded by most analysts. "The uncertainty surrounding the US presidential elections next month also is likely to weigh on markets along with the geopolitical tensions in the Middle East," he added.
Vijayakumar also commented on the consistent FII selling seen in October so far as they offload Indian equities worth Rs 58,394.56 crore. However, the quantum of FII was absorbed by domestic investors who lapped up Indian shares to the tune of Rs 57,792.20, preventing a freefall in the market.
Vijayakumar believes this trend of FII selling and DII buying is likely to be sustained in the near term since Chinese stocks continue to be cheap compared to the elevated valuations in India.
The Nifty IT index rose by half a percent driven by gains in Wipro, Tech Mahindra, and Infosys while the Nifty Metal index was also up half a percent lifted by JSW Steel, Hindustan Zinc, and Vedanta. On the other hand, pharma names came under the pressure of profit booking, dragging the Nifty Pharma index slightly into the red.
Shares of Avenue Supermarts plunged 8 percent after the D-Mart operator's net profit for the September quarter underwhelmed the Street, missing analyst estimates.
The retail major's net profit for the second quarter of FY25 rose by 5.8 percent on-year, reaching Rs 659.6 crore, compared to Rs 623.6 crore in the same period last year. Its revenue rose by 14.4 percent to Rs 14,444.5 crore. According to international brokerage Bernstein, the biggest miss for Avenue Supermarts was revenue growth, which was the slowest in four years. The like-for-like growth was the slowest in three years.
On the Nifty 50, Wipro, BPCL, and HDFC Bank emerged as the top gainers, rising 1-2 percent. In contrast, Axis Bank, Bajaj Finance, and Cipla were the biggest losers, falling around 1 percent each.
On the technical front, Jatin Gedia, Technical Research Analyst at Sharekhan by BNP Paribas expects the consolidation in the market to break only after the Nifty decisively breaks above 25,350 while on the downside, further fall below 24,800 is likely to weaken the structure.
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