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Indian Markets Continue Gains Amid Sectoral Volatility

By Mandar in Indian Market Insights —

Indian Market Overview: September 18

Indian equity markets continued their upward trend for the third consecutive day on September 18. This rally was primarily fueled by gains in the IT and banking sectors.

Key highlights of the day:

  • The Sensex closed at 83,013.96, up 0.39%.
  • The Nifty closed at 25,426.05, up 0.38%.
  • The Bank Nifty extended its winning streak to 12 sessions.

Sectoral Performance

  • IT sector showed strong performance.
  • Banking sector also performed well.
  • Auto, metal, PSU banks, and realty sectors faced declines.
Factors Influencing Sectoral Performance:
  • Banking: Improved credit demand outlook and expectations of sector re-rating contributed to growth.
  • IT: US Federal Reserve rate cut and signals of further cuts boosted investor confidence in outsourcing and technology spending.
  • Declining Sectors: Profit-booking, weakening rupee, expiry-day derivative volatility, and foreign institutional investor selling put pressure on these sectors.

Market Volatility and Key Movements

Despite the overall positive trend, the market experienced intra-day volatility.

  • The Sensex initially gained significantly before experiencing profit-booking.
  • Key laggards included Coal India, Bajaj Finance, Trent, ONGC, and Tata Motors.
  • Other sectors showed mixed performances, with pharma and midcap/smallcap indices seeing modest gains.

External Factors and Future Outlook

Positive global cues, including the Fed rate cut, have helped to ease concerns about inflation and growth trade-offs.

Analysts are expecting gradual upward momentum for the Nifty, with a target of 25,500 in the coming weeks, but volatility and profit-taking are expected to remain key themes.