CHENNAI: Indian equity markets ended higher on Thursday, January 29, extending their recent recovery for a third consecutive session as investors looked past early volatility and remained selectively constructive ahead of major domestic policy cues. Benchmarks moved in a narrow and choppy range through much of the day before firming up toward the close, supported by buying interest in metals, energy, infrastructure and select heavyweights.
The BSE Sensex closed with gains of around 220 points, while the Nifty 50 reclaimed and held above the 25,400 mark, reflecting a cautious but positive undertone in trade. The session began on a tentative note amid mixed global cues and lingering concerns over the sharp slide in the rupee to record lows. However, the release of the Economic Survey and its broadly optimistic assessment of India’s growth prospects helped stabilise sentiment, prompting investors to add to positions in pockets of the market.
The US Federal Reserve’s decision to pause interest rate hikes helped ease global risk aversion, supporting sentiment across emerging markets, including India. The steadier outlook for US rates encouraged selective buying in equities and lent support to domestic benchmarks despite lingering concerns over currency weakness.
Intraday trade was characterised by frequent swings as participants balanced domestic optimism against global uncertainty. Early selling pressure was seen in information technology and some private banking stocks, while defensives such as FMCG and pharmaceuticals also underperformed. As the day progressed, buying gathered momentum in cyclical and capital-intensive sectors, signalling expectations of continued public spending and a supportive policy stance in the forthcoming Union Budget.
Metal stocks emerged as notable outperformers, aided by hopes of improving global demand and a weaker rupee that enhances export realisations. Infrastructure and construction-linked counters also attracted steady interest on expectations of sustained government capex. Select energy and oil and gas stocks added to the upward bias, reflecting firm crude-linked margins and stable domestic demand.
Broader markets largely mirrored the benchmarks, with mid-cap and small-cap indices posting modest gains, indicating improving risk appetite after a period of consolidation. Market breadth was mildly positive, suggesting that buying was not confined only to index heavyweights but was spread across select pockets.
From a technical perspective, analysts viewed the Nifty’s ability to hold above the 25,400 zone as a constructive signal, though they cautioned that sustained upside would require follow-through buying and supportive cues from the Budget and global markets. Resistance levels remain higher, and participants are expected to remain selective rather than chase sharp rallies.
"The markets ended the session on a mildly positive note, supported by constructive global cues. Improved sentiments across Asian and European markets encouraged investors to accumulate quality stocks after recent consolidation. Buying interest remained focused on export-oriented sectors, manufacturing names, and select energy counters, aided by firm commodity prices and value buying at lower levels," said Enrich Money CEO R Ponmudi.
Currency weakness continued to be a key macro overhang, but equity investors appeared to take comfort in the Survey’s view that India’s growth momentum remains intact despite external headwinds. The belief that policymakers still have room to support growth without stoking inflation helped keep downside limited.
"The rupee traded in a narrow range against the U.S. dollar—benefiting from a softer dollar index but capped by month-end importer demand and cautious foreign flows," Ponmudi added.
Overall, Thursday’s close reflected a market that is gradually rebuilding confidence, supported by domestic growth optimism and expectations of policy continuity, even as investors remain alert to global risks and currency movements. The steady three-day advance suggests a cautious return of risk-taking, with the focus now shifting to signals from the Union Budget and further guidance on the economic outlook.