Indian equity benchmarks traded higher in early deals on Wednesday despite mixed global cues, as renewed foreign institutional investor (FII) buying and positive corporate earnings supported market sentiment.
However, concerns over artificial intelligence (AI) spending weighed on technology stocks across Asian markets.
The Sensex was trading nearly 400 points, or 0.5 per cent, higher at 77,251, while the Nifty gained 101.65 points, or 0.43 per cent, to reach 23,912.50.
Both benchmarks had opened lower, with the Sensex starting at 76,853.11, down 64.74 points, or 0.08 per cent, while the Nifty opened at 23,742.25, declining 68.60 points, or 0.29 per cent.
Sectoral indices remained mixed, with Nifty Consumer Durables, Realty and IT declining by up to 0.79 per cent. Metal, energy, private bank and PSU bank indices also traded in the red. Healthcare and pharmaceutical stocks, however, showed resilience, with their indices gaining up to 0.23 per cent.
Market analysts attributed the improving sentiment to a reversal in foreign investor activity. FIIs have purchased stocks in five of the last six trading sessions, with cumulative buying worth ₹18,661 crore.
Experts said attractive large-cap valuations and healthy corporate earnings were providing fundamental support to the rally. They added that weakening interest in AI-related stocks had also encouraged foreign investors to return to Indian equities.
The rally is expected to remain concentrated in large-cap stocks, particularly financial companies, which could attract further foreign inflows. Short covering may also support the upward movement.
Technically, the Nifty continued to trade above its 50-day Exponential Moving Average (EMA) near 23,196, while its Relative Strength Index (RSI) stood at 66.59, indicating strong bullish momentum.
Immediate support is placed between 23,500 and 23,600, while resistance is seen at 24,000–24,200. The 200-day EMA near 23,904 remains an intermediate hurdle. Analysts cautioned that profit booking could emerge at higher levels.
Meanwhile, FIIs recorded net purchases of ₹6,836 crore on Tuesday, extending their buying streak to three sessions. Domestic institutional investors (DIIs), however, continued selling for the third consecutive session, with net outflows of ₹3,678 crore.
Overnight, US markets closed higher, led by the Nasdaq, as major AI stocks rebounded ahead of the US midterm election results. Apple shares, however, declined following disappointing earnings.
Also Read: Sensex Surges 1,225 Points, Nifty Reclaims 23,800 As Earnings Optimism Lifts Markets
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