Nifty surges over 1 pc this week led by bank, auto stocks

Mumbai, Jan 3 The Indian equity benchmarks closed on a strong note this week, touching fresh all-time highs amid strong performance in the banking and auto sectors.

Nifty surged 1.05 per cent during the week and 0.70 per cent on the last trading day to 26,328. At close, Sensex was up 760 points or 0.67 per cent at 85,762. It surged 0.89 per cent during the week.

Bank Nifty also continued its outperformance and scaled fresh record highs above the 60,200 mark.

The Indian equities traded in a cautious tone till New Year, weighed down by persistent FII outflows and heightened global uncertainties. On New Year, the indices ended on a flat note, and on the last day of trading week, they touched fresh all-time highs.

Strong momentum was observed in the auto and PSU banking sectors, while sectoral rotation was evident in utilities as they gained traction on hopes of rising demand and increased industrial activity. Robust December auto sales indicate a broader uptick in economic activity during the festive-driven quarter.

Improving asset quality and expectations of accelerated credit growth drew investor interest toward PSU banking stocks, analysts said.

Conversely, FMCG index dipped 4 per cent for the week after the government announced a higher excise duty on cigarettes.

Broader indices outperformed benchmark indices for the week, with the Nifty Midcap100 up 1.74 per cent, while Nifty Smallcap100 edged up 0.77 per cent.

Precious metals continued their momentum, as trade disparity, supply constraints, geo-political tension, rate cut view and FII outflows continue to test the near-term risk appetite of investors.

According to analysts, a sustained hold by Nifty above 26,300 could accelerate the rally toward 26,500, with an extended upside potential toward 26,700 on strong follow-through. Bank Nifty is likely to continue outperforming the Nifty index in the near term, they added.

Key cues for investors going forward include US payroll and unemployment data for global market direction. Markets may move within a steady range as participants wait for clearer earnings‑led triggers and clarity on the India-US trade deal, market watchers said.

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