Indian equity markets closed firmly higher on Monday, February 23, extending the recovery for a second consecutive session as improving global cues and broad-based domestic buying lifted investor sentiment. The benchmarks opened on a positive note and steadily built on gains through the day, reflecting confidence that recent global trade uncertainties may ease and that domestic fundamentals remain resilient despite pockets of sectoral stress.
The Sensex ended the session with a gain of close to half a percent, reclaiming levels above 83,000, while the Nifty settled comfortably above the 25,700 mark. The advance was marked by strong participation across heavyweight stocks as well as broader market segments, signalling that the rally was not confined to a narrow set of names. Market breadth remained decisively positive, with advancing shares clearly outnumbering decliners, reinforcing the sense of a structurally supportive session rather than a short-lived technical bounce.
Financials and banking stocks played a central role in driving the indices higher, supported by continued optimism around credit growth, asset quality stability and improving operating metrics. PSU banks, in particular, saw renewed buying interest as investors selectively repositioned into value-oriented segments after recent consolidation. Autos and FMCG stocks also contributed to the upside, benefiting from expectations of steady domestic demand and easing cost pressures, while select infrastructure-linked and capital goods names attracted fresh flows on the back of medium-term growth visibility.
"Stock-specific action dominated the session. Shares of IDFC First Bank hit the 20 percent lower circuit at Rs 66.85 after the bank disclosed a Rs 590 crore fraud at its Chandigarh branch, triggering sharp selling pressure. Meanwhile, Indian IT stocks corrected close to 2 percent, reflecting ongoing concerns over AI-driven disruption to conventional outsourcing and service models. The uncertainty surrounding the pace of technological transition and its impact on earnings visibility continued to keep investor sentiment subdued within the sector," said Hariprasad K, SEBI-registered Research Analyst and Founder, Livelong Wealth.
Prasad added that since India VIX remained largely flat around 14.15, suggesting that despite stock-specific volatility, broader market fear levels did not escalate significantly. "While the index closed positive and reclaimed a key moving average, sectoral divergence and stock-specific risks continue to keep the undertone cautious," he said.
In contrast, information technology stocks continued to lag the broader market, reflecting persistent caution around global tech spending, margin pressures and the pace at which artificial intelligence-driven productivity gains will translate into revenue growth. The sector’s underperformance limited the upside to some extent, but was not strong enough to offset the positive momentum across the rest of the market. Export-oriented pockets also saw mixed activity as investors remained selective amid currency and global demand considerations.
From a macro and global perspective, sentiment was supported by a clear improvement in risk appetite following developments in international trade policy that reduced near-term uncertainty. This helped Asian markets trade with a positive bias and provided a constructive lead for domestic equities. The rupee traded in a relatively narrow range, offering additional comfort to equity investors by avoiding sharp currency-driven volatility during the session.
Technically, the market’s ability to hold on to gains and close near the day’s highs is significant. The Nifty’s move back above key resistance levels suggests that recent selling pressure has eased, at least in the short term, and that buyers are willing to accumulate on modest dips. Immediate support zones appear well-defined, while overhead resistance remains within reach if momentum continues. However, the pace of the move is likely to be influenced by global cues and sector rotation rather than broad-based re-rating.