Markets Rebound on Buying in Banking, Auto Stocks

Equity benchmark indices Sensex and Nifty staged a smart comeback in the late morning trade on Thursday after slipping into the negative territory in early trade as buying in banking and auto stocks helped the markets recover all the early lost ground.

The 30-share BSE Sensex opened on a firm note, rising 149.3 points to 84,540.57 while the broader NSE Nifty advanced 45.05 points to 25,803.05.

However, the indices soon pared early gains as selling pressure intensified across heavyweight counters.

Both benchmarks later regained strength as investor sentiment improved, aided by buying support in HDFC Bank, Kotak Mahindra Bank, and Reliance Industries.

Subsequently, the Sensex climbed 446.58 points, or 0.53 per cent, to 84,837.85 in the late morning trade. The Nifty rose 129.60 points, or 0.50 per cent, to 25,887.60.

Among the Sensex constituents, Kotak Mahindra Bank, Eternal, Maruti Suzuki India, Tata Steel, HDFC Bank, Reliance Industries, UltraTech Cement, Tata Motors Passenger Vehicles, Sun Pharmaceuticals and Tech Mahindra were the gainers.

On the other hand, Bharti Airtel, Asian Paints, Titan, ITC, Axis Bank, ICICI Bank were among the laggards.

The US Federal Reserve on Wednesday cut the federal funds rate by 25 basis points to a range of 3.5-3.75 per cent in its December meeting.

However, policymakers left their projections for the federal funds rate unchanged from September, signalling only one 25 basis points cut in 2026.

"The Fed decision, though favourable from the market perspective, is unlikely to have a significant impact on the Indian market, which is being weighed down by the sustained selling by FIIs, the huge supply of paper from IPOs and the poor earnings growth of the last six quarters," V K Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.

He added that a slowdown in IPOs is likely in 2026 since the irrationality in IPO pricing is becoming increasingly evident. Along with the likely slowdown in IPOs in 2026, when earnings growth picks up as expected, the market will respond positively.

In Asian markets, Japan's Nikkei 225 benchmark, Shanghai's SSE Composite and South Korea's KOSPI settled lower, while Hong Kong's Hang Seng is trading in the red zone.

Wall Street settled higher in overnight deals on Wednesday.

Meanwhile, Foreign Institutional Investors (FIIs) remained the net sellers of equities worth Rs 1,651.06 crore on Wednesday while Domestic Institutional Investors (DIIs) bought stocks worth Rs 3,752.31 crore, according to the exchange data.

Brent crude, the global oil benchmark, declined 0.63 per cent to USD 61.82 per barrel.

On Wednesday, the 30-share BSE Sensex dropped by 275.01 points to settle at 84,391.27, while the broader NSE Nifty fell by 81.65 points to close at a month's low of 25,758.