Sensex jumps nearly 400 points, Nifty tops 24,100 as IT stocks rebound

IT stocks led the rally, while falling crude oil prices and easing geopolitical concerns boosted investor confidence. However, a weak monsoon remains a key concern.

In Short

• Brent crude fell below $71, easing inflation and import costs for India
• IT stocks led gains with Nifty IT index up 3.37%, other sectors also advanced
• Infosys, HCLTech, TCS were top Sensex gainers; NTPC, BEL declined

Benchmark equity indices opened sharply higher on Thursday, driven by a strong rebound in information technology stocks and continued weakness in crude oil prices.

The BSE Sensex climbed 398.43 points, or 0.52%, to 77,321.07, while the NSE Nifty50 gained 123.90 points, or 0.52%, to trade at 24,129.75 in early trade.

Sentiment improved after Brent crude slipped below $71 a barrel following reports of positive progress in indirect talks between the US and Iran. Lower oil prices are positive for India as they help ease inflationary pressures and reduce the country's import bill.

The broader market also traded in the green. Nifty 100 gained 0.41%, Nifty 200 rose 0.38%, Nifty 500 advanced 0.36%, Nifty Midcap 50 climbed 0.34%, Nifty Midcap 100 gained 0.24% and Nifty Smallcap 100 added 0.41%. India VIX, the volatility index, fell 2.81%.

IT stocks emerged as the biggest gainers, with the Nifty IT index surging 3.37%. Nifty Mid Small IT & Telecom gained 1.68%, while Nifty Metal rose 0.80%, Nifty Consumer Durables advanced 0.68%, Nifty Realty gained 0.50%, Nifty Financial Services climbed 0.46%, Nifty Private Bank rose 0.45% and Nifty Auto added 0.34%.

Nifty Oil & Gas gained 0.34%, Nifty Healthcare Index rose 0.20%, Nifty Pharma advanced 0.18%, Nifty500 Healthcare gained 0.18%, Nifty Financial Services Ex-Bank rose 0.18%, Nifty FMCG gained 0.11% and Nifty Mid Small Financial Services added 0.08%. Nifty Media was flat, while Nifty PSU Bank slipped 0.03%.

Among Sensex stocks, Infosys jumped 4.44%, HCLTech gained 3.56%, TCS rose 2.82% and Tech Mahindra advanced 2.35%, leading the rally in IT shares.

Eternal gained 1.72%, Bajaj Finserv rose 1.09%, IndiGo climbed 1.03%, Titan gained 1.02%, Kotak Mahindra Bank advanced 0.85%, ICICI Bank rose 0.78%, Sun Pharma gained 0.74% and HDFC Bank added 0.73%.

On the other hand, NTPC fell 0.85%, BEL declined 0.79%, Larsen & Toubro slipped 0.77%, Power Grid dropped 0.73%, Bharti Airtel lost 0.54%, Bajaj Finance fell 0.45%, Maruti Suzuki declined 0.26%, Trent slipped 0.12% and ITC traded marginally lower.

Despite the positive start, investors remain cautious over the progress of the southwest monsoon. A prolonged rainfall deficit could hurt rural demand, agricultural output and inflation, making monsoon developments a key monitorable for markets.

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said, "There are some positive trends that are providing near-term support and strength to the market. One, crude continues to fall with Brent below $71 now. This will further strengthen India's macros and help in achieving higher growth while keeping inflation in check.

"Two, the auto sales numbers in June were strong with 24.1% growth in passenger vehicles. This indicates that the demand momentum in the economy continues to be strong.

"Third, the AI trade in South Korea is weakening, which is positive for non-AI markets like India. Fourth, FII selling is tapering off, giving an upper hand to DIIs. Whether India's outperformance will continue will depend largely on the progress of the monsoon, which continues to be unsatisfactory. The strength in the banking segment and digital platform companies is likely to continue in anticipation of good Q1 results."

(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)

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