Sensex, Nifty end marginally higher after volatile session; what should investors watch now?

Indian equity benchmarks staged a sharp intraday recovery to end marginally higher on Monday after a weak start, supported by buying interest in information technology (IT) and select banking stocks.

The 30-share BSE Sensex pack gained 47.01 points or 0.06 per cent to settle at 77,616.40, while the NSE Nifty50 index edged up 4.10 points, or 0.02 per cent, to close at 24,211.

Among the top contributors to the Sensex's gains were Infosys Ltd, Tata Consultancy Services (TCS), HCLTechnologies Ltd, ICICI Bank Ltd, Kotak Mahindra Bank, NTPC Ltd, Tech Mahindra Ltd, Mahindra & Mahindra (M&M) and Power Grid Corporation of India Ltd.

The broader indices also ended slightly higher, with Nifty Midcap 100 and Nifty Smallcap 100 inching up 0.01 per cent and 0.03 per cent, respectively.

Ankur Punj, MD & Business Head at Equirus Wealth, said, "The domestic benchmarks were highly volatile today, before ending with modest gains due to buying support in IT and select banking stocks. Investors were jittery following a sharp spike in crude oil prices due to the renewed flare-up in the US-Iran conflict. Caution may prevail going forward due to ongoing geopolitical tensions and macroeconomic uncertainty."

Ajit Mishra – SVP, Research at Religare Broking, stated, "Investor sentiment remained cautious amid renewed geopolitical tensions in the Middle East, which pushed Brent crude prices higher and weighed on global risk appetite. However, resilience in the IT pack following the start of the earnings season, coupled with selective buying in heavyweight stocks across sectors, helped the market recover from its intraday lows."

Vinod Nair, Head of Research at Geojit Investments, noted, "The market witnessed a strong intraday recovery. Another positive development is that despite selling pressure continuing in the global markets driven by concerns over an AI-led valuation bubble, the negative impact on Indian IT stocks has eased in recent weeks. FII selling in the Indian IT sector has also moderated, which could support a future shift in fund flows to India."

He added, "Investor concerns over tensions in the Strait of Hormuz were largely overlooked, while the moderation in crude oil prices during the day provided additional comfort to the market. The initial batch of broader Q1 earnings has come in better than expected, suggesting that earnings downgrades for the quarter may be less severe than previously anticipated. At the same time, Indian market valuations appear more reasonable, indicating a strong start to the Q1 earnings season."

From a technical standpoint, Nandish Shah, Deputy Vice-President at HDFC Securities, said, "Nifty found support near 24,029. Despite the strong intraday rebound, the index continues to trade within a consolidation phase. Going forward, the range of 24,300 on the upside and 24,000 on the downside remains crucial. A decisive breakout above 24,300 could trigger an up move towards 24,530, the previous swing high, while a breakdown below 24,000 may lead to a retest of the 23,800-support zone."