Markets Rally; Sensex Jumps 965 Points, Nifty Above 24,300 On IT Earnings Boost

Indian benchmark indices ended sharply higher on Thursday, with the Sensex soaring 964.58 points and the Nifty closing above the 24,300 mark, as strong buying in information technology and banking stocks offset weakness in the broader market.

The Sensex settled 964.58 points, or 1.25%, higher at 78,151.45, while the Nifty 50 gained 261.55 points, or 1.09%, to close at 24,334.30. Market breadth remained negative despite the rally, with 1,632 stocks advancing, 2,419 declining and 175 remaining unchanged.

Among the top gainers on the Nifty were Kotak Mahindra Bank, Tech Mahindra, TCS, Jio Financial Services and Reliance Industries, while Hindalco, Dr Reddy's Laboratories, Wipro, Sun Pharma and Max Healthcare ended among the major losers.

IT, Banking Stocks Drive Rally

Information technology stocks emerged as the biggest contributors to the market's gains after Tech Mahindra reported better-than-expected June-quarter revenue growth, margin expansion and robust deal wins.

The Nifty IT index rose 1.9%, making it the best-performing sectoral index. Tech Mahindra surged 4.4%, TCS gained 3.2%, and HCL Technologies advanced 1.8%.

Banking shares also witnessed strong buying. Nifty Private Bank climbed 2%, while the Nifty Bank index gained 1.6%. Other sectoral gainers included Nifty Auto and Nifty Realty, both up 1.3%, followed by Nifty Oil & Gas (1%) and Nifty FMCG (0.7%).

On the other hand, Nifty Pharma declined 1.4%, while Nifty Metal fell 0.4%. Broader markets underperformed, with the Nifty Midcap 100 falling 0.4% and the Nifty Smallcap 100 declining 0.2%.

Large-Caps Return To Favour

Investor sentiment was also supported by strong June-quarter earnings from Jio Financial Services, whose shares rose 3.4% after the company reported a 156% year-on-year jump in consolidated net profit and a 227% increase in revenue.

Meanwhile, Reliance Industries gained 2% ahead of its June-quarter earnings announcement later in the day. Analysts expect stronger refining margins and improving petrochemical profitability to support the company's performance.

The rally was further aided by value buying in heavyweight stocks following recent weakness, even as global cues remained subdued.

Vinod Nair, Head of Research at Geojit Investments, said market leadership is shifting back towards large-cap stocks, particularly IT and banking companies, amid optimism around corporate earnings.

He said domestic institutional investors appear to be rotating out of richly valued mid- and small-cap stocks into attractively valued large-cap companies offering a better risk-reward profile. Nair added that buying interest is also emerging in consumer durable stocks on expectations of healthy domestic demand in the second half of FY27, while the broader outlook for Indian equities remains constructive.

Technical Outlook

Rupak De, Senior Technical Analyst at LKP Securities, said the Nifty has broken out of a five-day consolidation phase, signalling improving optimism among traders and investors.

According to De, the benchmark index continues to trade above its key moving averages, while the Relative Strength Index (RSI) has entered a bullish crossover, reinforcing the positive momentum. He expects the Nifty to remain strong in the near term, with the potential to move towards the 24,800 level. On the downside, he sees immediate support at 24,200, adding that a decisive breach below this level could trigger a fresh phase of consolidation.