Indian benchmark indices closed on a strong note on Tuesday, fueled by gains in banking and metal stocks amid supportive global cues and positive sentiment ahead of key domestic data.

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The S&P BSE Sensex surged 597.67 points or 0.74 per cent to close at 80,845.75, while the NSE Nifty50 advanced 181.10 points or 0.75 per cent to end at 24,457.15.

Banking, and metal stocks boost market sentiment

Banking stocks led the charge, particularly PSU banks, which saw significant buying interest due to their sensitivity to interest rate movements. Metal stocks also performed well, supported by increased import duties and strong manufacturing data from China.

Vinod Nair, Head of Research at Geojit Financial Services, commented, "Benchmark indices continued to demonstrate resilience amidst positive global sentiment. Investors are now focusing on potential growth drivers, assuming that weak economic data has already been reflected in the recent lacklustre corporate earnings. The immediate attention is expected to remain on the RBI's interest rate guidance and liquidity management. Banking stocks experienced the highest gains due to their interest rate sensitivity, while metal stocks benefited from increased import duties and favourable manufacturing data from China."

Sectoral and technical highlights

Sectorally, PSU Bank and Media indices led the rally, while FMCG and Pharma stocks lagged. Mid and Smallcap indices remained range-bound but managed to outperform frontline indices.

Technically, the Nifty has given a breakout from an inverted head-and-shoulders pattern, suggesting a trend reversal from negative to positive. Analysts see immediate resistance at 24,660, with support shifted higher to 24,300.

As investors eye the RBI’s monetary policy announcement later this week, expectations of liquidity measures and guidance on interest rates are keeping the markets buoyant. The focus now shifts to potential growth triggers as the market shrugs off concerns from recent GDP data.