Indian equity markets concluded Thursday on a higher note, breaking a three-session losing streak despite significant volatility in the final minutes of trading. The Sensex expiry day saw the Closing Auction Session (CAS) draw considerable attention as markets reacted to rapid shifts.
Late-Session Swings Propel Benchmarks
The 30-share BSE Sensex experienced a dramatic surge, climbing 1,186.55 points from 74,521.79 at approximately 3:21 pm to 75,708.34 by 3:23 pm. Similarly, the Nifty50 on NSE rose from 23,389.25 around 3:19 pm to 23,761.65 by 3:21 pm. By market close, the Sensex settled 138.36 points (0.19 per cent) higher at 74,902.59, while the Nifty50 gained 46.30 points (0.20 per cent) to reach 23,477.80.
Despite the benchmark gains, the broader market showed weakness, with the Nifty Midcap100 declining by 0.38 per cent and the Nifty Smallcap falling 0.07 per cent.
Top Performers Among Sensex Constituents
Several major stocks contributed to the Sensex's recovery. Notable gainers included HDFC Bank Ltd, Axis Bank Ltd, Bharti Airtel Ltd, Larsen & Toubro Ltd (L&T), Power Grid Corporation of India Ltd, Kotak Mahindra Bank Ltd, UltraTech Cement Ltd, and Bajaj Finance Ltd.
Analyst Insights on Market Dynamics
Vinod Nair, Head of Research at Geojit Investments, highlighted that the prospect of synchronized monetary tightening intensified due to higher crude prices and prolonged geopolitical tensions, fueling energy-led inflation concerns. Investors are now awaiting key US inflation data for cues on interest rate trajectories. Nair also noted that rising global bond yields and concerns over a potential yen carry trade unwind, driven by expectations of a Bank of Japan rate hike, are likely to pressure capital flows into emerging markets. He concluded that while strong August equity fund flow data and a moderation in the SIP stoppage ratio offered some support, sentiment was tempered by a depreciating rupee and firming domestic bond yields.
Ponmudi R, CEO of Enrich Money, observed that Indian equity markets ended resiliently within a narrow range after three consecutive sessions of sharp declines. However, initial recovery lost momentum, with many sectors reversing early gains. This reversal, he stated, underscored a lack of sustained buying interest at higher levels and a broader risk-off mood. While the session hinted at easing selling pressure, the overall trend remains weak, with sellers retaining the upper hand despite the potential for a short-term relief rally.
Nifty Technical Outlook
Rupak De, Senior Technical Analyst at LKP Securities, indicated that the Nifty closed higher due to the CAS, following a lackluster session. On the daily timeframe, the index formed a hammer pattern, suggesting a pause in the recent bearish trend. De identified immediate support for the Nifty in the 23,380–23,400 zone, with resistance placed at 23,550–23,600. A sustained move above 23,600, he suggested, could extend the recovery towards 23,800.