Sensex, Nifty extend recovery; what's driving this upmove? -
On the sectoral front, buying interest was visible across several segments, with IT, pharma and healthcare stocks leading the recovery.
Indian equity benchmarks extended their recovery on Friday amid improved investor sentiment and favourable domestic cues.
At the last check, the 30-share BSE Sensex pack climbed 478.12 points or 0.64 per cent to trade at 74,629.16, while the NSE Nifty index advanced 161.70 points or 0.70 per cent to 23,098.45.
On the sectoral front, buying interest was visible across several segments, with IT, pharma and healthcare stocks leading the recovery.
Corporate earnings have emerged as a key support for the domestic market. In its recent report, Jefferies said the September 2026 quarter (Q2 FY27) earnings season has been healthy so far, with the upgrade ratio staying above 50 per cent.
Of the 105 companies from its coverage universe that had reported results, 56 per cent posted earnings above expectations, up 4 percentage points (ppt) quarter-on-quarter (QoQ). FY27 earnings estimates were also upgraded for 50 per cent of the companies, although this was 2 ppt lower than the previous quarter.
The brokerage said banks, two-wheelers, power utilities and consumer technology companies delivered better results, while IT and consumer staples reported mixed performances. Four-wheeler companies remained weak.
Jefferies also raised its FY27 MSCI India earnings growth estimate by 1 ppt to around 15 per cent, while noting that a few heavyweight companies were yet to report their results. According to the global brokerage, consensus earnings estimates remained largely unchanged so far.
The firmer domestic currency has also provided some support to market sentiment. The rupee has recovered to around the 95-per-dollar level against the US dollar, supported by RBI intervention. It had touched a record low of 96.96 in May.
With that being said, Dinshaw S Irani, CEO of Helios Capital India, told Business Today that the worst may be over for Indian markets, citing further strengthening of the rupee and better-than-expected Q2 FY27 earnings, which could provide further impetus to growth.
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, said, "The Q2 FY27 earnings season has been positive, with no major negative surprises. Some bottom fishing has been taking place, and investors should follow a 'buy-on-dips' and 'sell-on-rallies' strategy. The US Federal Reserve's decision to maintain the status quo on interest rates has also provided a positive backdrop for the domestic market in the short to medium term."
The US Federal Reserve maintained its benchmark interest rate at 3.75–4 per cent.
Ravi Singh, Chief Research Officer at Master Capital Services, said, "Markets extended gains, supported by good buying in IT stocks and positive earnings from Trent and IndiGo. However, elevated crude oil prices, West Asia tensions and continued FII selling limited the upside. Weakness in broader markets also kept investors cautious. Going ahead, Reliance Industries' Q2 results, oil prices and global market trends will guide sentiment."
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