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BusinessConsumption stocks drive Sensex, Nifty over 2% on easing volatility

Consumption stocks drive Sensex, Nifty over 2% on easing volatility


The domestic stock market indices Sensex and Nifty opened on a strong footing and extended gains through the day as increased risk-taking saw consumption stocks being favoured by investors. After witnessing heavy volatility in the previous session, key market indicators Sensex and Nifty ended over 2% higher supported by steady buying in FMCG, pharma and auto stocks.

Trading began on a strong note after easing of political uncertainty with benchmark Sensex gaining over 1000 points from its opening level. It touched an intraday high of 73,726.78 rising more than 1630 points before settling at 73,609.91, up 1610.92 points or 2.23%. The broader Nifty index jumped over 510 points to close above the 22,400 level, gaining 2.29% at 22,386.75. Among sectors, FMCG and pharma emerged as top gainers while PSU banking and metal stocks lost ground.

Sectors seen as defensive plays such as FMCG, pharma and healthcare witnessed heightened buying interest as investors turned to non-cyclical areas. Major FMCG players like HUL, ITC, and Britannia rose between 3-6% while pharma bellwether Dr. Reddy's advanced 4%. Increased risk appetite was evident as VIX, a gauge of volatility eased over 13% from its elevated levels. Broader markets also participated in the rally though midcap and smallcap indices closed with more modest gains.

Going forward, market movement will depend on cabinet announcements and direction of economic policies. Easing of geopolitical risks and renewed buying support indicates the resilience of domestic equities. However, increased stock-specific action can be expected in the coming sessions. On the technical front, Nifty has potential to surpass 22350-22400 resistance zone while PSU banking index may see further profit-taking.

The Northlines is an independent source on the Web for news, facts and figures relating to Jammu, Kashmir and Ladakh and its neighbourhood.

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