Sensex and Nifty Performance Overview

The BSE Sensex opened sharply lower by 487.07 points but staged a robust recovery, gaining 577.67 points during the day to settle at 83,829.73, up 90.60 points or 0.11%. Despite the recovery, the index remains 2.78% below its 52-week high of 86,159.02. The Nifty 50 mirrored this trend, trading with subdued volatility and closing nearly flat.

Technically, the Sensex is currently trading below its 50-day moving average (DMA), which itself is positioned above the 200-DMA, indicating a mixed medium-term trend. The large-cap segment was the primary driver of the modest gains, while mid and small caps lagged behind.

Sectoral Trends: Utilities Shine, IT Faces Pressure

Out of 38 sectors tracked on the BSE, 31 advanced while 7 declined, signalling broad-based participation in the rally. The S&P BSE Utilities sector emerged as the top performer, surging 2.36% on the back of strong buying interest in power and infrastructure stocks. Conversely, the Nifty IT sector was the biggest laggard, plunging 6.19% amid profit-booking and concerns over global demand slowdown.

Other sectors such as FMCG, Pharma, and Financial Services showed resilience, supporting the overall market stability. However, the sharp weakness in IT weighed on the broader indices, reflecting investor caution on export-dependent sectors.

Market Breadth and Capitalisation Trends

The market breadth was positive with an advance-decline ratio of 316 advances to 182 declines across the BSE 500, translating to a healthy 1.74x ratio. This indicates that more stocks participated in the upside, albeit with varying degrees of strength.

Large-cap stocks outperformed, with the BSE 100 index rising 0.21%. In contrast, the mid-cap and small-cap indices declined by 1.59% and 3.3% respectively, highlighting a risk-off sentiment among investors towards smaller companies.

Top Gainers and Losers Across Market Caps

Among the large caps, Adani Power was the standout performer, rallying 7.38% on renewed investor interest amid expectations of improved operational performance. On the downside, Infosys tumbled 7.26%, dragged down by sector-wide weakness and profit-taking.

In the mid-cap space, Lloyds Metals led the gains with a 9.96% jump, buoyed by positive sectoral momentum and favourable commodity prices. Meanwhile, Coforge declined 6.72%, reflecting the broader IT sector pressure.

Small caps witnessed more pronounced volatility, with Faze Three surging 20.00% on speculative buying, while Timex Group plunged 9.99%, highlighting the riskier nature of this segment in the current environment.

Other notable gainers in the BSE 500 index included Sheela Foam (+16.10%) and BLS International (+12.66%), while the biggest losers were eClerx Services (-9.20%), Latent View (-7.53%), and Triveni Turbine (-7.44%).

Foreign Institutional and Domestic Institutional Activity

Foreign Institutional Investors (FIIs) remained cautious, with net outflows observed in the equity segment amid global uncertainties and mixed economic data from major economies. Domestic Institutional Investors (DIIs), however, continued to support the market with selective buying, particularly in large-cap and defensive sectors.

This divergence in activity contributed to the mixed market performance, with investors weighing global risks against domestic growth prospects.

Global Cues and Their Impact

Global markets were volatile, influenced by ongoing geopolitical tensions and mixed economic indicators from the US and Europe. The US Federal Reserve’s recent comments on interest rate policy and inflation outlook kept investors cautious. Asian markets showed a mixed trend, with China’s economic data failing to inspire confidence.

These global factors weighed on the Indian IT sector, which is heavily reliant on export revenues, while domestic sectors such as utilities and infrastructure found favour due to government spending and policy support.

Upcoming Corporate Results to Watch

Investors are closely monitoring the upcoming quarterly results of key companies scheduled for 5 February 2026, including Bharti Airtel, Tata Motors Passenger Vehicles, and Power Finance Corporation. These results are expected to provide further direction to their respective sectors and influence market sentiment in the near term.

Market Outlook and Investor Takeaways

The market’s ability to recover from early losses and close marginally higher suggests underlying resilience, particularly in large-cap stocks. However, the divergence between large caps and mid/small caps, coupled with sectoral disparities, indicates that investors remain selective and cautious.

With the Sensex still below its 50-DMA and global uncertainties persisting, the near-term outlook remains guarded. Investors should monitor upcoming corporate earnings closely, especially from heavyweight sectors such as telecom, automotive, and finance, which could provide fresh impetus or caution.

Additionally, the sharp weakness in the IT sector warrants attention, as it may signal broader concerns about global demand and margin pressures. Conversely, sectors like utilities and infrastructure may continue to attract interest due to stable earnings and government support.

Overall, a balanced approach focusing on quality large caps with strong fundamentals and selective mid-cap opportunities appears prudent in the current environment.

Upgrade at special rates, valid only for the next few days. Claim Your Special Rate →