Benchmark indices rose over 1.8 per cent on Thursday, led by strong buying in index heavyweights.
The Sensex settled at 79,943, up 1,436 points or 1.83 per cent from its previous close. The Nifty50 ended at 24,188, up 445 points or 1.88 per cent.
The broader market showed mixed performance, with smaller companies lagging behind their larger counterparts. The Nifty Midcap 100 Index advanced by 1.14 per cent, while the Smallcap 100 Index posted a more modest gain of 0.64 per cent. Market breadth remained positive for the third consecutive session, with an advance-decline ratio of 1.55.
Strong buying was seen in heavyweights especially auto, NBFCs and IT stocks, driven by optimism about upcoming quarterly earnings.
Nifty formed a bullish candle on both daily and weekly timeframes signalling that the bulls are back in control with further upside potential. The FII long-short ratio dropped to 13% which is at its lower band and triggered short covering in the index leading to a sharp recovery in the market, said Chandan Taparia, Head, Equity Derivatives & Technicals, Wealth Management, MOFSL.
December auto sales provided a boost, with stocks like Eicher Motors and Maruti Suzuki surging more than 8.5 per cent and 5.5 per cent respectively. The technology sector gained nearly 2 per cent, supported by optimistic revenue projections for the December quarter and a positive outlook for 2025.
GST collections stood at ₹1.77 lakh crore in December, against ₹1.82 lakh crore in November, driven by higher revenues from domestic transactions.
Vinod Nair, Head of Research, at Geojit Financial Services, said: “Increased momentum was observed in the domestic market, driven by optimism about the upcoming earnings season starting next week. The rally was broad-based, with most sectoral indices posting gains. The auto sector led the way, showing the strongest momentum due to robust December sales that defied the usual subdued demand. Banking and IT stocks also performed well, as the economy bottomed in Q2.”
Market participants will look to the upcoming earnings season starting next week, particularly from IT companies. Additionally, the market will watch ITC’s planned demerger of its hotel business into ITC Hotels, scheduled for January 6.
Technically, the previous resistance at 23,900 for the Nifty now serves as support, with the next resistance anticipated around 24,400.
“The Nifty has demonstrated remarkable strength, rallying over 750 points from its recent low of 23,460. The index’s move above 24,178 has pushed it beyond its 20-day SMA, while establishing a higher top and higher bottom formation on the daily chart – signalling a potential trend reversal,” said Devarsh Vakil – Deputy Head Retail Research, HDFC Securities.
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