NEW DELHI: India’s equity market is heading towards a fresh peak with benchmark indices – NSE Nifty50 and BSE Sensex - gaining for the sixth straight session on Monday. The Nifty50 on Monday reclaimed the 26,000 level and is now just 1 percent away from its all-time high level of 26,277.
The Nifty50 ended at 26,014, up 103 points, or 0.4 percent while Sensex gained 388 points or 0.5 percent to close at 84,951. The Sensex touched its peak value of 85,478 on 27 September 2024.
The two indices have gained around 2 percent over the past six sessions and the combined market capitalisation of BSE-listed companies has surged by Rs 11 lakh crore during this period to Rs 477 lakh crore. Market sentiments have turned bullish over a healthy earnings season, development on the India-US trade deal and expectations of rate cuts by the central bank.
“Expectations of a major trade deal added to the optimism, acting as a potential catalyst for the next leg of the rally. The up-move was further supported by the NDA’s decisive victory in Bihar, which reinforced confidence in policy continuity and political stability. Softer inflation data also contributed to the improved market sentiment,” said analysts at Bajaj Broking.
They added that on the daily chart, Nifty has formed a bullish candle and continues to create higher highs and higher lows, clearly indicating that the uptrend from last week remains strong.
“With this strong technical backdrop, Nifty is expected to continue its upward move. The index may first approach 26,100, and if momentum sustains, it could extend further towards 26,300 in the near term. On the downside, support has shifted higher to the 25,800–25,850 zone…The broader outlook remains constructive, with market sentiment continuing to favour the bulls,” stated the brokerage.
The broader market outperformed the benchmarks on Monday with Nifty Midacap100 and Smallcap100 rising 0.7 percent and 0.6 percent respectively. All sectoral indices ended in the green with PSU Banks and Financial services stocks leading with gains of over 1 percent each. Bank Nifty hit a fresh record high today, climbing above 58,900 for the first time.
“The advance comes after a steady upswing in the Bank Nifty over recent sessions, supported by sustained buying in PSU Banks, heavyweight private lenders and firm sectoral sentiment. The potential India-US trade deal remains a crucial trigger that market participants are closely watching,” said Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services (MOSFL).
On the earnings front, the MOFSL Coverage Universe (330+ companies) grew 12 percent YoY (vs. estimated 9%) in 2QFY26, with overall growth driven by OMCs, Telecom, Metals, Technology, NBFCs – Lending, Cement, and Capital Goods.
“The current risk-reward setup remains broadly favourable, supported by stronger-than-expected results from Midcaps, that has reinforced confidence in growth revival and signal the potential for future earnings upgrades. Overall, we expect the market to witness continued up-move, driven by improving earnings momentum, strong domestic macros and stable policy support,” added Khemka.
Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities said that market breadth remained firmly positive, with the Advance/Decline ratio tilted in favour of advancers. From the Nifty 500 universe, 328 stocks ended higher, reflecting strong participation across segments.
Considering the current chart structure, the Nifty is likely to continue its northward journey and test the level of 26150, followed by 26300 in the short term, stated Khemka. While on the downside, the support is shifted higher in the zone of 25900-25880 level.