Sensex notches mild gains at open, Nifty tests 25,000 while IT stocks drag, pharma shines

Nifty extends gains to seventh session in a row.

Domestic equity benchmarks Nifty 50 and Sensex opened on a tepid note, following mixed global cues on September 11, Thursday. Market sentiment remains cautiously optimistic, although persistent volatility and mixed global cues continue to weigh on investor confidence.

At 09:20 am, the Sensex was up 139.95 points or 0.17 percent at 81,565.10, and the Nifty was up 32.70 points or 0.13 percent at 25,005.80. About 1,724 shares advanced, 858 shares declined, and 153 shares unchanged.

At the opening bell, sectoral indices showed a mixed trend. Nifty Pharma led the gains, rising 0.5 percent, followed by Nifty Energy up 0.5 percent and PSU Bank higher by 0.2 percent. FMCG, Infra, Auto, Realty, and Metal indices inched up with marginal gains. On the other hand, Nifty IT slipped 0.4 percent, emerging as the biggest laggard. Overall, broader sentiment remained steady across sectors.

India has underperformed compared to other global markets, said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments. Largely this underperformance is the correction of the overvaluation caused by sustained domestic capital inflows into the market. Now the largecaps are fairly valued, but the mid and smallcaps, particularly the latter, continue to be overvalued.

Nifty continues to grapple with the psychological 25,000 mark, which has emerged as a stiff resistance zone. Additionally, after a long time, Nifty managed to close above the 50-day SMA (Simple Moving Average), which is largely a positive sign.

Going ahead, 24,920 and 24,850 levels will act as key support zones for traders. “As long as the market continues to trade above these levels, the bullish trend is likely to continue. On the upside, the index can move towards 25,100–25,200. On the other hand, if the market falls below 24,850, traders can consider exiting their long positions,” said Shrikant Chouhan, Head Equity Research, Kotak Securities.

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