Profit Booking Triggers Early Dip; Sensex & Nifty Regain Ground

Indian equity markets opened with a steep gap-down on Tuesday but managed to recover part of the early losses as investors booked profits following the recent rally.

The opening session remained volatile, reflecting cautious sentiment and mixed global cues.

The Sensex traded at approximately 85,508, down 134 points or 0.16 per cent. The Nifty slipped by 31 points or 0.12 per cent to 26,145, signalling a subdued start to the day.

Market analysts noted that despite the pullback, the broader trend in the Nifty remains positive.

“The Nifty’s positional trend stays bullish, with strong support at the 26,000–26,050 zone. On the higher side, 26,300 could act as resistance on a closing basis,” they observed.

Major heavyweights, including HDFC Bank, ICICI Bank, Ultratech Cement, Axis Bank, Bajaj Finserv, Tata Steel, Tata Motors PV, Titan Company, and Power Grid, exerted downward pressure on the indices.

Eternal also traded weakly in the early session, adding to the drag.

However, selective buying in frontline stocks helped cap losses and supported a mild rebound in the Sensex.

Asian Paints, Infosys, Bharti Airtel, Bajaj Finance, SBI, Maruti Suzuki, NTPC, HUL and L&T were among the key gainers contributing to this limited recovery.

Mixed Performance Across Market Segments

In the broader market, the Nifty MidCap index edged up 0.27 per cent, reflecting renewed interest in mid-sized companies.

Conversely, the Nifty SmallCap index slipped 0.12 per cent, indicating sustained caution in the segment.

Sector-wise performance remained uneven. Financial stocks were among the weakest performers, with the Nifty Financial Services index falling 0.7 per cent and the Nifty Bank index declining 0.4 per cent.

In contrast, PSU banks stood out, as the Nifty PSU Bank index gained 0.9 per cent, emerging as the top-performing sectoral index. The Nifty Auto index also advanced, rising 0.4 per cent.

Analysts remarked that volatility persisted as traders continued to book profits amid fluctuating global trends.

They suggested that the consolidation phase offers opportunities for long-term investors.

“Investors can use the current consolidation to gradually accumulate fairly valued large-caps and growth-oriented midcaps, which are likely to lead the next phase of the market rally,” they advised.

Although smallcaps remain overvalued, analysts believe that the Bank Nifty still has the potential to lend stability to the broader market due to favourable valuations.

The recent improvement in credit growth also supports the outlook for the banking segment.

Despite early weakness, the markets showed resilience by recovering from steep opening losses, suggesting steady underlying sentiment even amid ongoing volatility.

Also Read: Markets Slip Ahead Of RBI Policy Meet As Profit Booking Weighs On Sentiment