Benchmark indices recovered late on Friday, closing higher for the second consecutive session, driven by gains in metals and PSU bank stocks amid a dovish stance from the Reserve Bank of India (RBI) and expectations of US Federal Reserve rate cuts in October. The Sensex rose by 223.86 points, or 0.28 percent, finishing at 81,207.17, while the Nifty 50 increased by 57.95 points, or 0.23 percent, to settle at 24,894.25, reclaiming its pivotal 50-day moving average at 24,830.
Tata Steel topped the Nifty 50, soaring 3.45 percent to close at ₹173.29, with Power Grid Corporation following closely, rising 2.85 percent to ₹288.65. Kotak Mahindra Bank advanced 2.17 percent to ₹2,108, while Axis Bank gained 2.03 percent to ₹1,183. Larsen & Toubro completed the top five gainers with a 1.98 percent increase to ₹3,742.90.
Conversely, Max Healthcare Institute was the worst-performing stock, plummeting 3.88 percent to ₹1,070, followed by Tech Mahindra, which fell 1.27 percent to ₹1,398. Eicher Motors slipped 1.23 percent to ₹6,935, Coal India declined 1.18 percent to ₹383.90, and Maruti Suzuki dropped 0.98 percent to ₹15,808.
“Following a period of range-bound trading, the market displayed a positive close, bolstered by metal and consumer durables stock gains. The optimism surrounding a potential Fed rate cut in October, a weakening dollar, and stable base metal prices contributed to the rally in metal indices,” stated Vinod Nair, Head of Research at Geojit Investments Limited. The Nifty Metal index surged by 1.8 percent, and the Nifty PSU Bank index climbed by 1.12 percent, benefiting from recent RBI regulatory measures, including an extension of the ECL migration timeline and reduced risk weights.
Market breadth favored bullish sentiment, with 2,636 stocks advancing compared to 1,568 that declined on the BSE. A total of 190 stocks reached their 52-week highs, while 83 hit their 52-week lows. Five stocks were locked in lower circuit, with none hitting upper circuit. The broader markets outperformed benchmarks, with the Nifty Midcap 100 increasing by 0.83 percent to 57,503.35 and the Nifty Smallcap 100 gaining 0.69 percent.
“The Nifty has extended its pullback for the second consecutive session, surpassing the crucial 50-DMA at 24,830 and forming a bullish candle on the daily chart. After last week’s significant decline, the index is showing recovery by closing above the 24,800 mark,” remarked Nilesh Jain, Head of Technical and Derivatives Research Analyst at Centrum Broking. “Looking ahead, a gradual move towards 25,200 seems feasible, and a decisive breakout beyond this level could pave the way for a prolonged rally towards 25,500.”
Among sectoral indices, the Nifty India Defence index gained 2 percent for the third consecutive session, while the Nifty Consumer Durables index also showed strong gains. The Nifty Bank index rose 0.44 percent to 55,589.25, and the Nifty Financial Services index added 0.17 percent to 26,426.75. However, sectors such as healthcare, construction, media, and automobiles experienced weakness during the session.
In the currency market, the rupee depreciated slightly by 0.07 percent to 88.75 against the US dollar following the RBI policy announcement. “The RBI’s commitment to actively manage short-term rates through two-way liquidity operations has helped mitigate downside pressure. However, persistent US tariffs remain a concern, keeping the rupee under pressure even as the dollar index stays steady between 96 and 98,” noted Jateen Trivedi, VP Research Analyst at LKP Securities.
Gold prices showed a robust recovery, rebounding from an initial decline of ₹600, trading near ₹1,17,600. “This sharp pullback indicates buyer interest on dips, maintaining the broader uptrend. Key support is at ₹1,16,500 and $3,840, while resistance is expected at ₹1,18,500 and $3,900,” added Trivedi. Brent crude prices fell for the third consecutive session, reaching a 16-week low due to concerns over a potential US government shutdown and expectations of increased OPEC+ supply.
“The index is currently trading above its 200-day EMA at 24,411 but faces resistance from the 20-day EMA at 24,914. The RSI has recovered from near oversold territory but remains below the neutral 50 mark, suggesting cautious optimism with potential for improvement,” stated Sudeep Shah, Head of Technical Research at SBI Securities. “Key levels indicate the 24,920–24,950 zone will serve as immediate resistance. If the index manages to exceed 24,950, the pullback could extend further towards the 25,100 level.”
For the week, both benchmark indices gained nearly 1 percent, with the Sensex increasing by 780 points and the Nifty advancing by 0.97 percent. The Nifty PSU Bank index emerged as the week’s top performer, surging by 4.45 percent, followed closely by the Metal index, which rallied by 3.90 percent. “Market momentum has turned positive post-GST rate cuts, with quarterly updates from value retailers reflecting strong performance in revenue and same-store sales growth,” highlighted Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services.
Looking ahead, market participants are expected to focus on upcoming US Nonfarm Payrolls and unemployment data, which could induce volatility in the short term. “Positive momentum is likely to persist, supported by accommodative monetary policy, beneficial monsoon conditions, and recovering festive demand. Participants should concentrate on sectors showing relative strength, such as metals, autos, and PSUs, while remaining selective in others,” asserted Ajit Mishra of Religare Broking. Technical analysts suggest that as long as the Nifty remains above the 24,600 level, a buy-on-dips strategy is advisable, with immediate targets at 25,100-25,150 and major resistance at 25,400.
Published on October 3, 2025.
