Mumbai: Benchmark Indian equity indices ended higher on Wednesday, as strong quarterly earnings and stock-specific buying outweighed concerns over rising crude oil prices and global uncertainties.
The BSE Sensex climbed 609.45 points or 0.79% to close at 77,496.36, while the Nifty 50 advanced 181.95 points or 0.76% to settle at 24,177.65, crossing the 24,100 mark.
Earnings optimism lifts markets
Despite weak global cues, investors remained focused on corporate earnings, which have largely come in better than expected. This led to selective buying across sectors, helping markets recover from recent lows.
According to Vinod Nair, Head of Research at Geojit Investments Limited, the rebound was driven by investors using the recent correction to build positions.
“Despite elevated crude prices and geopolitical uncertainty, markets have been supported by strong earnings and stock-specific opportunities,” he noted.
Crude oil surge raises concerns
Global crude oil prices remained elevated, posing a potential risk to inflation and market sentiment.
Brent crude hovered around $114.43 per barrel, while WTI crude stood at $103.38, both witnessing sharp gains amid concerns over tightening supply. Reports of a possible extension of US restrictions on Iranian ports have further added to supply-side worries.
Rising crude prices typically impact import-heavy economies like India, increasing inflationary pressures and widening the current account deficit.
Sectoral performance: FMCG, auto shine
Gains were led by FMCG, auto, and realty stocks, driven by strong earnings and positive outlooks.
The FMCG index rose 1.75%, auto gained 1.15%, IT advanced 0.99%, and oil & gas added 0.71%. Realty stocks also performed well, climbing 1.48%, while healthcare saw modest gains.
On the downside, financial services declined 0.28%, PSU banks slipped 0.41%, media fell 0.49%, and consumer durables edged lower.
The broader market showed mixed trends, with the Nifty Midcap 100 slightly down by 0.07%, while the Nifty Smallcap 100 gained 0.65%.
Top gainers and losers
Among Sensex constituents, ITC Limited emerged as the top gainer, rising 3.86%. Other major gainers included Tech Mahindra (3.14%), Maruti Suzuki (2.82%), Reliance Industries (2.68%), and Bharti Airtel (2.30%).
Additional gainers were Mahindra & Mahindra, Sun Pharmaceutical Industries, Adani Ports, Hindustan Unilever, Infosys, Larsen & Toubro, and TCS.
On the losing side, NTPC declined 1.33%, followed by Bajaj Finserv (1.04%), Asian Paints (0.84%), and ICICI Bank (0.83%). HDFC Bank and State Bank of India also ended lower.
Volatility eases
The India VIX, a measure of market volatility, declined 3.37% to 17.44, indicating easing investor anxiety despite global uncertainties.
Outlook remains cautious
While earnings-driven buying has provided support to the markets, analysts caution that rising crude oil prices and geopolitical tensions remain key risks.
Investors are expected to closely track global developments, particularly movements in oil prices and the upcoming policy decision by the US Federal Reserve, which could influence near-term market direction.
Conclusion
Indian equity markets showed resilience by closing higher despite global headwinds. Strong earnings have boosted investor confidence, but elevated crude oil prices and external uncertainties may keep volatility in check in the coming sessions.
(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 Read Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
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