Sensex and Nifty Indices Rise Amid TCS Report and Positive Global Markets

Indian stock markets began the first trading session of the week on a positive note and continued to rise on Monday, July 6. The growth was driven by the easing of geopolitical conflicts in the Middle East, stable crude oil prices, investor confidence ahead of first-quarter report publications, as well as active buying in the automotive, real estate, and oil and gas sectors.

Index Dynamics During the Day

The BSE Sensex index increased by 624.33 points, which is 0.80 percent, reaching the level of 78,388.24. Simultaneously, the NSE Nifty 50 index rose by 182.65 points or 0.75 percent, reaching the mark of 24,453.50 during intraday trading. By noon, the Sensex showed a rise of 563 points (0.72%), while the Nifty 50 was up by 168 points (0.69%) at a value of 24,439.

Sectoral and Stock Performance

Among the components of the Sensex, HDFC Bank shares led the growth with an increase of 1.34 percent. Mahindra & Mahindra, Bharat Electronics, Reliance Industries, and ICICI Bank also showed noticeable growth, with their quotes increasing by up to 2 percent. Buying interest spread to broader markets: the Nifty Midcap 100 and Nifty Smallcap 100 indices rose by 0.31 percent and 0.34 percent, respectively.

The Nifty Realty index led the sector, rising by 1.39 percent. This was followed by Nifty Auto and Nifty Oil & Gas, which showed gains of 1.13 percent and 1.12 percent. However, stocks in the information technology and public sector banking sectors came under pressure: the Nifty IT index fell by 0.89 percent, and the Nifty PSU Bank index dropped by 0.33 percent.

Market Overview and Influencing Factors

The overall market landscape remained negative, as out of 3,311 stocks traded on the NSE, 1,736 declined, while 1,462 rose, and 11 remained unchanged. Regarding oil prices, they slightly decreased after OPEC+ announced that seven of its members plan to increase production by 188,000 barrels in August. The global benchmark Brent crude traded lower by 0.28 percent at $71.9 per barrel, and WTI crude fell by 0.16 percent to $68.58.

According to the exchange, Foreign Institutional Investors (FIIs) were net buyers, acquiring assets worth 1,355.33 crore rupees on Friday. VK Vijayakumar from Geojit Investments noted that the shift of FIIs to buying last Friday is a positive signal for the market in the short term. He also mentioned that in June, FPI sold shares worth 53,957 crore rupees, while investing 4,617 crore rupees through the primary market, resulting in a net outflow of 49,340 crore rupees.

Technical Analysis and Outlook

VK Vijayakumar suggested that the slowdown in global chip trade and a significant correction in the Kospi could lead to an increase in capital inflow into India. SK Hynix shares in South Korea fell by almost 3.5 percent, and Japan's Nikkei 225 traded in the red. Strong demand in heavyweight stocks also contributed to an optimistic trend: HDFC Bank shares jumped by 3.5 percent after publishing excellent first-quarter results, and Reliance Industries grew by 1.3 percent. Rajesh Palviya from Axis Direct believes the trend remains constructive as long as Nifty holds above the breakout zone of 24,150, which now serves as immediate support. Sustained growth above 24,400 could pave the way for 24,600, while a break below 24,150 might trigger profit booking towards 24,000.

Indian stock markets continued to gain profit for the third consecutive day on Friday. The rise in indices was driven by falling crude oil prices, active purchases of shares in the IT and metallurgy sectors, as well as a favorable technical picture.

Dynamics of Major Indices

The BSE Sensex index increased by 655 points, which is 0.85 percent, reaching the level of 78,157. Simultaneously, the NSE Nifty50 index advanced by 202 points, or 0.83 percent, in early trading sessions, reaching 24,378.

Impact of Global Factors

Investor sentiment was further supported by positive global signals. The US employment report for June, which was weaker than expected, strengthened expectations of a softer policy from the Federal Reserve, leading to a new record high for the Dow Jones index. At the same time, the Nasdaq fell by more than 1 percent amid ongoing selling in stocks related to artificial intelligence and semiconductors.

Analysis of Market Growth Causes

According to VK Vijayakumar, Chief Investment Strategist at Geojit Investments, India's relative advantage is supported by the weakness of the KOSPI index and the general weakness of global chip trade. He noted that the continued slowdown in the outflow of funds from foreign institutional investors (FIIs) is another significant factor supporting the market. Nevertheless, Vijayakumar warned that fundamental support is necessary for this rally to be sustainable.

Factors Contributing to Growth

One of the key factors was the decline in crude oil prices, as transit through the Strait of Hormuz resumed, reducing supply concerns. The price of Brent crude dropped below $71 per barrel—the lowest level since late February—which eased inflationary concerns for a major oil-importing economy like India. In the last check, Brent fell by 0.01 percent to $71.75 per barrel, and WTI fell by 0.09 percent to $68.63 per barrel.

The IT sector became the biggest beneficiary, as investors accumulated shares in this sector due to attractive valuations. The Nifty IT index rose by 2.79 percent in the early trading session before correcting its gains, ultimately showing an increase of 1.96 percent, reaching 27,493. Shares of HCL Technologies rose by approximately 4 percent, while Persistent Systems, Mphasis, and Tech Mahindra traded more than 2 percent higher.

Support from Large Issuers

The rise in benchmark indices was also ensured by purchases in the shares of large companies, including ICICI Bank, HDFC Bank, Bharti Airtel, Infosys, and HCL Technologies. In the last check, these stocks showed a rise of up to 2 percent.

Technical Analysis and Forecasts

According to analysts, the overall market trend remains constructive, supported by improving momentum indicators, a strong position in the derivatives market, and a sharp decrease in volatility. Aakash Shah, Technical Research Analyst at Choice Broking, suggested that the immediate trading range for Nifty is between 24,000 and 24,300, and a decisive breakthrough above 24,300 could trigger the next phase of the rally towards the 24,500–24,600 level.

GIFT Nifty, which serves as an early indicator of Nifty50 dynamics, traded more than 100 points higher amid mixed global signals. Futures for this index were valued at 24,448 points, which is 182 points higher.

Asian Market Recovery

Most Asian exchanges managed to compensate for initial losses. They had previously declined as investors continued to close positions in semiconductor stocks. The KOSPI of South Korea and the Nikkei 225 of Japan traded up by 1.4% and 0.28%, respectively.

US and Commodity Market Dynamics

Overnight, the Dow Jones index rose by 1.14%, while the Nasdaq Composite closed down by 0.8%. The S&P 500 index remained unchanged. Oil prices remained stable, and increased tanker traffic through the Strait of Hormuz improved supply forecasts. The July futures contract on the International Exchange was valued at $71.99 per barrel, up 0.26%.

Precious Metals Behavior

Futures for gold and silver increased by 1.56% and 2.4%, respectively. The rise in metal prices occurred against the backdrop of the latest US employment report, which was weaker than expected and reduced concerns about a Federal Reserve interest rate hike.

IPO Information

On Friday, the subscription opens for the Initial Public Offering (IPO) of IC Electricals, which is a book-built offering worth 47.91 crore rupees. Additionally, Knack Packaging completes the last day of subscription for its IPO, aiming to raise 439.5 crore rupees from the primary market.