GG News Bureau
Bengaluru, 5th Jan. Indian benchmark indexes experienced a second consecutive session of growth on Friday, primarily driven by a surge in auto and IT stocks. Additionally, the realty sector received a boost from Macrotech Developers’ strong sales performance.
The NSE Nifty 50, a blue-chip index, increased by 0.12% to reach 21,684.80 points, while the S&P BSE Sensex rose by 0.13% to 71,933 as of 10:58 a.m. IST.
Although the Nifty reached record highs earlier in the week, it faced selling pressure in the following two sessions. However, the index managed to regain some ground due to positive quarterly updates from key lenders and financial companies on Thursday.
“At the start of the New Year, there has been some nervousness as valuations in certain areas appear stretched,” said Jaykrishna Gandhi, head of business development of institutional equities at Emkay Global Financial Services.
Gandhi added that the domestic market rally is expected to be supported by strong macroeconomic fundamentals and a steady earnings outlook. He referred to the Reserve Bank of India’s (RBI) fiscal 2024 growth upgrade, stable inflation, and robust credit growth.
The IT index experienced a 1% increase, recovering from a significant decline earlier in the week. However, IT stocks are still down 2.2% for the week due to dampened expectations of early U.S. rate cuts in 2024, following the release of Federal Reserve policy minutes and fresh labor market data in the U.S.
Auto stocks rebounded by 0.5% after a decline earlier in the week caused by mixed monthly sales data and tax demands for companies like Eicher Motors and Mahindra & Mahindra.
Realty stocks continued to gain momentum for the third session, increasing by 0.75%. This growth was driven by strong quarterly updates from key players such as Macrotech Developers, Sobha, and Oberoi Realty, as well as a positive sales outlook for the sector.
Small- and mid-cap stocks, which are more focused on the domestic market, each gained about 0.2%. However, analysts remain cautious about these segments due to elevated valuations.
