Sensex jumps 800 pts from day's low, Nifty above 23,300 as metal, IT stocks rally; broader markets in red

JSW Steel, Power Grid Corp, HUL, Tata Steel, and Grasim were the top Nifty gainers.

In a sudden rise, benchmark indices Nifty and Sensex traded firmly in the green led by a sharp uptick in IT and metal stocks. Meanwhile, the sentiment was weak in pharma and auto companies. With this gain, the frontline indices have now rallied for a third trading session in a row.

In global development, the Bank of Japan hiked rates by 25 basis points Friday to 0.5 percent, bringing its policy rate to its highest level since 2008, as it seeks to normalize its monetary policy. On the other hand, US' benchmark S&P 500 rose to a record closing high, while the other two gained for a fourth day in a row after U.S. President Donald Trump called for lower interest rates and cheaper oil prices.

At about noon, the Sensex was up 409.43 points or 0.54 percent at 76,929.81, and the Nifty was up 124.50 points or 0.54 percent at 23,329.85. About 1,243 shares advanced, 2,085 shares declined, and 103 shares unchanged.

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"The strength of the US market with the S&P 500 setting yet another record high and the 10-year US bond yield remaining strong around 4.65 percent will continue to weigh on the Indian market. FIIs will continue to sell putting pressure on large caps like banking. The irrationality in the market characterised by fair and even low valuations for large caps like banking and excessive valuations in the broader market will have to reverse at some point in time," V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.

Relentless foreign portfolio investor (FPI) selling, a slowing economy, and underwhelming corporate earnings have cast a shadow over Indian markets. FPIs offloaded over Rs 5,000 crore in the cash market just yesterday, pushing their cumulative outflows for the month to a staggering Rs 66,321.65 crore, according to Moneycontrol data.

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The broader market, represented by mid- and small-cap stocks was back in the red following a massive rise in the previous session. The mid-small cap indices slipped 0.5 and 1.2 percent, each. On January 22, the mid-small cap indices crashed a massive 2 percent. Despite the rise, the broader market will likely see sustained pressure amid the given uncertainty and volatility, market experts suggest.

As for sectoral indices, Nifty IT was the best performer for the third session in a row led by Infosys, TCS, Wipro, Coforge and Persistent Systems. Robust results and attractive valuations have been behind the surge in tech stocks. The metal index followed suit led by Tata Steel, Vedanta and JSW Steel. Bank Nifty also rose led by HDFC Bank and ICICI Bank.

Laggards included Nifty Pharma, trailing by over 1 percent. This was largely driven by Dr Reddy's after brokerages dished out mixed calls following a weak Q3. Nifty Energy, Auto and Realty indices also slipped 0.4 percent each.

Paytm share price recovered partially after dropping more than 8 percent in January 24 trade on the buzz of an ED probe in a crypto scam. Moneycontrol earlier reported that Paytm, Razorpay, PayU, Easebuzz and four other payment gateways are being investigated as the Enforcement Directorate (ED) froze around Rs 500 crore in their virtual accounts over the past two years in connection with some Chinese nationals running one of the biggest cryptocurrency scams, HPZ Token, from India.

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Shares of telecommunications player Indus Tower gained two percent in the morning session on January 24, after its reporting better-than-expected earnings for the quarter ended December (Q3) of the current financial year (FY25). Indus Towers reported a consolidated net profit of Rs 4,003 crore for the quarter, marking a 159.9 per cent increase from Rs 1,541 crore in the same quarter of the previous financial year on the back of significant collections of overdue from Vodafone Idea and robust tower additions.

Shares of Mankind Pharma plunged nearly 6 percent on January 24, weighed down by a fall in the company's October-December net profit. The company's bottomline dropped over 16 percent on year in Q3 to Rs 385 crore, dented by a sharp rise in expenses. The drugmaker's Q3 net profit was also impacted by the $1.6 billion acquisition of Bharat Serums and Vaccines (BSV), which came into effect in October.

"The two days of consecutive upsides failed to gain momentum is suggestive that a range breakout might take longer to evolve. So, while we brace for more swings within the 23,000-23,400 region, positivity may linger as long as above 23,155. Such positivity could however wane once 23,300 is crossed, but may resurface on push above 23,440," Anand James of Geojit Financial Services. "Alternatively, a slippage past 23,155 may let bears dominate, though a free fall may be restricted by 23,050-22,980 supports for now," he added.

JSW Steel, Power Grid Corp, HUL, Tata Steel, and Grasim were the top Nifty gainers. Dr Reddy's, IndusInd Bank, Apollo Hospitals, Trent, and M&M were the major laggards.

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