Sensex touches eight-month high as Indian shares extend winning run

Indian equity markets extended their winning streak as the Sensex climbed 107.25 points to settle at 81,106.65, marking its highest closing level in more than eight months. The Nifty rose 58.25 points, or 0.23 per cent, to close at 25,044.65, holding above the crucial 25,000 mark. Markets were shut on Tuesday for Diwali-Pedhipratipada.

Market Movers

Banking stocks led the gains, with PSU banks outperforming the broader market. The Nifty PSU Bank index surged nearly 3.7 per cent, while the Bank Nifty advanced around 1.5 per cent, supported by gains in SBI, HDFC Bank and ICICI Bank. Pharma stocks also attracted buying, but IT and metal stocks faced profit-booking, with HCL Technologies, Infosys, Tech Mahindra and Tata Steel among the key laggards. Broader markets remained resilient as the Nifty Midcap 100 gained around 0.55 per cent and small-cap stocks posted marginal gains.

Market Outlook

Sentiment drew support from easing crude oil prices, improving foreign investor participation and reduced geopolitical concerns, while the India VIX declined sharply to signal lower market anxiety. Technically, the Nifty has broken above multiple resistance zones and could head towards its next major resistance near 25,500. However, the relative strength index has moved above 77 into overbought territory, raising the possibility of near-term profit-booking. Raja Venkatraman, co-founder of NeoTrader, suggests investors look to buy the index on dips towards 25,000 rather than chase the rally at current levels.

Context

Stock market benchmarks move up and down based on overall investor buying and selling across various listed companies. A winning streak means the market index has closed higher for several trading sessions in a row. Technical indicators like moving averages and the relative strength index help market analysts study past price trends to guess where prices might go next.