It was that tech-driven shift that allowed Indian equities to offset the weak global cues on 13 July. With IT in the driver’s seat, traders had to be mindful of the 24,300 mark. The Nifty 50 made a sharp intraday recovery to end at 24,211; the Sensex wrapped up at 77,564.
Things were a little on edge to begin with. Nifty gave up 168 points in the early going on news of new missile and drone activity between US and Iranian forces and some chatter about the Strait of Hormuz. But there was steady buying to be found around 24,000 and the index put back more than 250 points from its low.
You could call it leadership rather than a free-for-all. IT and autos did the work while investors put geopolitics in the rear-view mirror and homed in on earnings. The midcap and smallcap indices were left where they were, making for a selective kind of risk-on day.
IT-fuelled rotation steadies Nifty as geopolitics flare
Technology was in charge. The Nifty IT was up 3.59%, well ahead of the 2% and 1.15% you saw in Media and Consumer Durables. Meanwhile, FMCG, Metals and Cement were in the red by 0.70-1%, a sign of the money moving into software and a few consumption names.
There were a few things in play. TCS put in a 5.4% move to Rs 2,182 on the back of a multi-million-dollar ABB contract, a good read on enterprise demand. HCL Technologies was 5% in the green before its June-quarter numbers, feeding some of the good will around large-cap IT.
The story is backed up by the flows. Vinod Nair of Geojit Investments says the updated commentary and better valuations have done something for sentiment, and the AI-related overhang on Indian IT is not as much of an issue. He sees FII selling in the space has let up, which bodes well for fund inflows.
Autos were part of the turn-around too. Bajaj Auto was 2.2% higher at Rs 10,381, mopping up some of the unease over oil after crude moved on West Asia news. The Nifty was in the plus side for a bit before closing in for a third session in a row with a small gain.
Winners: Software steals the show; consumer shine continues
Newgen Software was the one to watch, finishing 13.3% up at Rs 585. Then you had a group of IT stocks like Sonata, Zensar, Birlasoft, Tech Mahindra, Infosys, Mphasis, Cyient, eClerx, Coforge, Persistent and Netweb all in on the rally, with moves of 2.5-11%.
The run in jewellery is far from over. Kalyan Jewellers made it four in a row, 7.25% to Rs 511, for 35% in the month of July. Pine Labs was no slouch either, 7% to Rs 155, as the market keeps an eye on fintech and consumption.
Tata-led momentum and fintech milestones
Some of the heft in today’s move came from the Tata stable. You had 6.1% or so in the likes of Tata Technologies, Elxsi, Voltas and Motors, showing there is room for both R&D and the consumer side of the business.
One97 (Paytm) was 3.3% in the money at Rs 1,386, having hit a new 52-week top at that level in the course of the day.
With the stock inching up to Rs 1,400 – a level not in view since December 2021 – fintech has once again made it onto watch lists.
Losers: A quiet day for banks and capital goods
The rally was not universal. Even as the broader market found its footing, some of the big names in banking and capital goods were left behind. Jammu & Kashmir Bank was down 5.2% and Siemens Energy India 3.5%. There was a similar slide for a host of others like Ather Energy, PhysicsWallah, NLC India, GE Vernova T&D India, Indian Bank, Bharat Dynamics, Thermax, Nuvama Wealth Management, Blue Jet Healthcare and Godrej Industries, all of which gave back 2.5% to 3.4%.
You can see the divide in the numbers. IT, Media and Auto put in a good show, but FMCG and Metal held up poorly, with Healthcare also finishing in the red on the Nifty. It is a market that is currently more interested in what you can see in the earnings than in a defensive posture.
Geopolitics was there in the periphery, if only to set the tone at the open. Word of Tehran making moves against US interests in the Gulf and talk of a closed Strait of Hormuz had crude prices on the rise after two days of weakness. The fact that the market has come back for it is a sign of home-grown strength, though the headline risk is still out there.
Nifty for July 14: 24,300 is the line in the sand
The consensus among analysts is one of measured optimism heading into Tuesday. The index is treading water in the 23,800-24,500 band. Technicians are pointing to 24,300 as the first hurdle, given the bearish gap and where we were last week. On the other side, 24,000 has been well-defended by buyers over the past couple of sessions.
There is some agreement on how to play this. Nagaraj Shetti is looking for a push to 24,500 from the support we have. Nilesh Jain has his eye on the 100-DMA around 24,000 and the setup above 24,200. Hitesh Rathi’s advice is to hold off on any chases until we see a firm close past 24,300.
What to be watching for:
– 24,300: Immediate resistance
– 24,530: If we break out
– 24,050-24,000: First port of call for support
– 23,850-23,800: More solid ground
– 23,800-24,500: The wider range
In the end, it comes down to the numbers. Siddhartha Khemka is calling for a steady climb as Q1FY27 figures come in and move the dials. We have over 140 companies in the reporting queue this week – Reliance, the major private and public sector banks, HCLTech, Wipro, Tech Mahindra, Jio Financial and JSW Steel, to name a few. They make up 31% of the Nifty 50.
Then there is the macro side: June CPI and WPI, then unemployment and the trade balance. The primary market is no slouch either, with three IPOs in the works for about Rs 10,100 crore.
Bank Nifty in focus
After some lagging, the financials steadied in the latter part of the session. Bank Nifty made a recovery from 57,500 to finish 0.15% in the green at 58,131. Sudeep Shah has 58,600-58,700 as the next wall to scale; get past 58,700 and 59,400, even 60,000, are in play. 57,600-57,500 is where the support lies.
For 14 July, the story is straightforward. The IT sector has done enough to turn things around at the bottom, but now the index is up against a clear supply zone. Until 24,300 is put to rest, it is better to be methodical with entries and keep an eye on both the earnings and any news out of West Asia.
