Closing Bell: Sensex rises 174 points; Nifty closes at 25,725 led by IT, PSU Bank gains

Indian equity benchmarks extended gains for the second straight session on Tuesday, supported by buying in IT, FMCG and PSU banking stocks, while volatility remained elevated amid active derivatives positioning.

The 30-share BSE Sensex rose 173.81 points to close at 83,450.96, up 0.21 per cent. The broader Nifty 50 settled at 25,725.40, higher by 42.65 points or 0.17 per cent.

Indices Rebound From Lower Levels

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Market expert Anil Singhvi said the tone of the market has improved compared with the recent phase of uncertainty, as indices rebounded sharply from intraday lows for two straight sessions.

“Strength is when the market opens lower and then rises to close near the day’s high. That shows conviction,” Singhvi said.

In the previous session, Nifty had dropped to around 25,375 before recovering nearly 300 points from lower levels. On Tuesday, the index again declined in early trade to around 25,575 and then rebounded close to 200 points. Singhvi said such moves indicate buying interest at key support zones.

Volatility Remains Elevated

Singhvi cautioned that traders should remain alert as heavy positioning in the options segment could lead to sharp intraday swings. “Whenever positioning is heavy, volatility increases. Traders have returned in the last two sessions, and that is visible in volumes,” he said.

He noted that active derivatives positioning has contributed to higher volatility even as the broader tone of the market has improved.

IT, PSU Banks Lead; Metals Drag

Among Sensex constituents, ITC rose 2.33 per cent. Bharat Electronics gained 1.96 per cent, Infosys advanced 1.83 per cent, and Larsen & Toubro added 1.74 per cent. Asian Paints climbed 1.67 per cent, while Titan rose 1.46 per cent. Adani Ports, HCL Technologies and Sun Pharma also gained over 1 per cent. Maruti Suzuki, SBI and TCS ended in positive territory.

On the other hand, Reliance Industries fell 0.87 per cent. Tata Steel declined 1.31 per cent, and Trent dropped 1.28 per cent. Eternal slipped 1.52 per cent. M&M, Bajaj Finserv, ICICI Bank, Axis Bank and Bharti Airtel also closed lower. HDFC Bank ended marginally higher, while UltraTech Cement finished flat.

Broader markets outperformed the benchmarks. Nifty Next 50 gained 0.54 per cent. Nifty Midcap indices rose between 0.14 per cent and 0.28 per cent. Nifty Smallcap indices advanced up to 0.74 per cent, while the Nifty Microcap index surged 0.99 per cent.

Sectorally, Nifty IT rose 1.03 per cent, and Nifty FMCG climbed 0.90 per cent. Nifty PSU Bank jumped 2.11 per cent, emerging as the top sectoral gainer. Nifty Auto gained 0.52 per cent and Nifty Pharma rose 0.41 per cent.

However, Nifty Metal declined 1.06 per cent. Nifty Realty fell 0.30 per cent, and Nifty Oil & Gas slipped 0.11 per cent. Nifty Financial Services edged lower by 0.07 per cent.

Mid, Small Caps Participate

On the broader market outlook, Singhvi said mid- and small-cap stocks have participated in the recovery but remain below their earlier peaks. He noted that small-cap stocks are still around 16–17 per cent below their highs.

According to him, several macro triggers that the market was awaiting have already materialised, including easing pressures and improving earnings visibility. “Most positive triggers are in place. The market has not fully responded yet. It may be a matter of time,” he said.

At the same time, he cautioned that stock selection risk remains high in the small-cap space. “There is a strong possibility that the stock you buy may not move. That risk is always higher in small caps,” Singhvi said.

He advised investors to consider diversified small-cap mutual funds instead of taking concentrated exposure to individual stocks. Systematic investment plans in small-cap funds could also be considered at current levels, he added.