Mid-day Mood | Nifty hits all-time high, tops 25100; Sensex rises as IT, healthcare counters rally, realty stocks slump

Nifty, Sensex

Following a sharp rally in IT and healthcare stocks, NSE Nifty 50 hit a fresh all-time high, topping 25,100 for the first time ever, while BSE Sensex also gained after a flat start on August 28. This bullish momentum comes on the back of expectations of an interest rate cut by the US Fed next month.

At noon, the Sensex was up 265 points or 0.32 percent at 81,977, and the Nifty was up 87 points or 0.35 percent at 25,105. As many as 1885 shares advanced, 1397 shares declined, and 92 shares unchanged.

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Building on yesterday’s gains, the broader market—especially mid and small-cap indices—continued to shine, rising 0.2 percent and 0.4 percent respectively. Analysts warn of potential overvaluation in some sectors, yet the broader market still seems to have room to grow. Notably, these indices have comfortably outpaced Nifty’s year-to-date performance.

Sectoral Trend

The IT index rose a massive 2 percent backed by gains in LTIMindtree, Infosys, TCS, and Wipro. LTIMindtree was the top gainer on the Nifty after domestic brokerage firm Kotak Institutional Equities upgraded the stock to an 'add' rating and raised the target price to Rs 6,200. The Healthcare index was in second position, gaining almost 1 percent. The Nifty Pharma, Energy and Auto were the other gainers.

Nifty FMCG and Realty were the top losers after both fell 0.4 percent. Consumer majors such as Varun Beverages, ITC, and HUL spoiled the party. India VIX, an index to gauge market anxiety, rose slightly above 1 percent to hover close to 14 levels.

Fundamental View

V K Vijaykumar of Geojit Financial Services said that the market has entered a consolidation phase with low volatility, a trend expected to continue in the near term. Falling U.S. bond yields have curtailed FII selling, with foreign investors even becoming marginal buyers. Historically, domestic institutional investors (DIIs) tend to sell when FIIs buy, which could keep the market range-bound with a slight upward bias. This is considered a healthy trend given the market’s elevated valuations.

Technical View

Vaishali Parekh of Prabhudas Lilladher anticipates that the index could target 25,600 next, with key stocks like L&T, Infosys, ICICI Bank, and Maruti supporting this upward move.

Sensex is now targeting its all-time high of 82,130, with a strong bias. As sentiment improves, the index is advancing with crucial support at the 20 DMA level of 80,350. A decisive break above 82,130 could push the index towards 83,000 in the near term. Daily support is at 81,300 and 24,900, while resistance is at 82,300 and 25,200.

Key Nifty Gainers

LTIMindtree, Wipro, IndusInd Bank, Infosys, and Eicher Motors

Key Nifty Losers

Hero MotoCorp, Asian Paints, Axis Bank, Maruti Suzuki, and Britannia Industries

Key Sensex Gainers

Wipro, IndusInd Bank, Infosys, Bharti Airtel, and Tech Mahindra

Key Sensex Losers

Asian Paints, Axis Bank, Maruti Suzuki, Nestle, and Bajaj Finserv

Stock Moves

IndusInd Bank: Shares rose 2 percent to become one of the top Nifty 50 gainers after CLSA reiterated an 'Outperform' and noted a potential upside of 28 percent from current levels, setting a target of Rs 1,800. So far this year, the stock of IndusInd has underperformed the benchmark Nifty 50, down 12 percent as compared to the latter's 15 percent rise.

Tata Elxsi: Shares tanked nearly 5 percent as Kotak Securities reiterated a 'sell' call on the stock citing expensive valuations. Tata Elxsi at 61 times one-year forward earnings is more than adequately factoring in all positives. It described Tata Elxsi as an "excellent company" but with inflated valuations.

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