Midcaps Hit Record High as Defence, Auto Stocks Outshine Weak Benchmarks

Indian equity benchmark indices ended on a subdued note on Thursday after a volatile trading session, with weakness in IT and FMCG stocks offsetting gains in defence, auto and broader market counters.

The BSE Sensex fell 114 points to settle at 77,844.52, while the NSE Nifty50 ended largely flat at 24,326.65. The benchmarks swung between gains and losses through the session before closing marginally lower.

Despite the weak headline close, market breadth remained firmly positive, with the NSE advance-decline ratio standing at nearly 2:1.

Midcaps Hit Record High

Broader markets significantly outperformed frontline indices, with the Midcap index surging 676 points to close at a record high of 62,003, its first-ever finish above the 62,000 mark. The Smallcap index also continued its strong momentum.

Defence stocks emerged as the biggest gainers during the session. Paras Defence rallied nearly 9%, while Bharat Dynamics and Bharat Forge posted strong gains amid renewed investor interest in the sector.

Auto stocks also remained in focus. Bajaj Auto gained nearly 3% after reporting strong Q4 earnings and announcing a share buyback, while Hero MotoCorp extended gains for a second session following upbeat management commentary.

In the broader market, Bharat Forge jumped nearly 7% after its quarterly results, while Paytm, Polycab and CG Power featured among the top midcap gainers.

IT, FMCG Weigh on Benchmarks

On the downside, HUL, TCS, Tech Mahindra, Titan and ITC dragged the Nifty lower. Coal India also ended weak following reports of a possible government stake sale.

Sunny Agrawal, Head, Fundamental Research at SBI Securities, said benchmark indices closed marginally lower while broader markets outperformed strongly. He noted that buying interest remained concentrated in auto, defence, media and metal stocks, whereas FMCG, IT and consumer durable sectors witnessed selling pressure.

Oil Below $100 Supports Sentiment

Global sentiment remained mixed through the day. Brent crude slipped below the $100 per barrel mark after reports suggested progress towards a potential US-Iran agreement to gradually reopen the Strait of Hormuz.

Vinod Nair, Head of Research at Geojit Investments, said domestic equities oscillated between gains and losses amid mixed global cues, though easing crude prices helped reduce near-term inflation concerns.

However, he added that optimism faded later in the session due to uncertainty surrounding nuclear enrichment negotiations, triggering profit booking in parts of the market.

Nair also highlighted that selective risk appetite remains visible, particularly in mid and smallcap stocks, while earnings and management guidance continue to drive stock-specific action.

Rupak De, Senior Technical Analyst at LKP Securities, said the Nifty has given a consolidation breakout on the daily chart, indicating improving optimism. He added that the index has moved above its 50-day EMA, while RSI indicators also signal strengthening momentum.

According to De, the Nifty could move towards the 24,750–24,800 zone in the short term, while support remains placed near 24,200.