Indian Markets End Flat on Day 1 of 2026, ITC Drag Offsets Auto Rally; FMCG Sees Sharpest Fall in 3 Years

Indian equity benchmarks ended the first trading session of 2026 on a mixed and largely flat note on Thursday, January 1, amid thin liquidity as most global markets remained closed for the New Year holiday. Investor activity was muted, with participants awaiting monthly business updates from corporates for fresh earnings cues.

At the close, the Nifty 50 inched up 16.95 points, or 0.06 per cent, to settle at 26,146.55, extending its recent gains. The Sensex, however, slipped 32 points, or 0.04 per cent, to end at 85,188.60. The India VIX, a measure of market volatility, hovered around 9.2, marking its lowest level in the past year and indicating subdued risk perception.

Autos Lead, FMCG Takes a Hit

Sectorally, the market breadth tilted positive, with 9 out of 11 sectoral indices ending in the green. The Nifty Auto index emerged as the top performer, rising 1.03 per cent, ahead of December monthly sales data that is expected to reflect the impact of recent Tax cuts. This marked the third consecutive session of over 1 per cent gains for the auto index.

Other sectors such as Nifty Realty, Nifty IT, and Nifty Metal also advanced by more than 0.5 per cent each. In contrast, the Nifty FMCG index was the sole laggard, plunging 3.17 per cent, its steepest Intraday fall since February 24, 2022, nearly three years ago.

ITC, Godfrey Phillips Slide on Excise Duty Hike

The sharp decline in FMCG was driven by heavy selling in cigarette stocks after the government announced an increase in excise duty on cigarettes effective February. ITC shares fell 9.71 per cent, while Godfrey Phillips India plunged 17.08 per cent, significantly weighing on the benchmarks.

Broader Markets Mixed

In the broader market, the Nifty Midcap 100 index gained 0.44 per cent, while the Nifty Smallcap 100 edged lower by 0.04 per cent, reflecting a mixed trend beyond frontline indices.

Market Breadth Snapshot

Market breadth tilted marginally in favour of declines. Of the 3,223 stocks traded on the NSE, 1,683 advanced, 1,448 declined, and 92 remained unchanged. During the session, 66 stocks touched their 52-week highs, while 62 stocks hit 52-week lows. Additionally, 79 stocks were locked in Upper Circuits and 52 stocks in Lower Circuits.

Despite a positive start to the year for select sectors like autos, the sharp fall in FMCG—led by ITC—kept headline indices largely flat on the first day of 2026.

Disclaimer: The article is for informational purposes only and not investment advice.