Record-Breaking Friday: Nifty Hits Historic High & Sensex Soars 573 Points

Closing Bell

The Indian stock market kicked off the first week of 2026 on a triumphant note as the Nifty 50 scaled a fresh lifetime high of 26,340 during Friday’s Intraday session. While the index saw a minor retracement from its peak to settle at 26,146.55, the overall sentiment remained overwhelmingly bullish. The Sensex followed suit with a robust gain of over 573 points, closing at 85,762.01. Although the 30-share index remains slightly below its all-time high set in late 2025, the broad-based buying across large and mid-cap segments suggests a strong start to the new calendar year.

The rally was primarily powered by the Realty and Metal sectors, which emerged as the day's top performers. Nifty Realty surged by 1.52 per cent, buoyed by renewed investor interest in premium residential projects, while the Metal index gained over 1 per cent, tracking a recovery in global industrial demand and firming commodity prices. In contrast, the FMCG sector was the lone outlier, dragging on the indices due to a sharp sell-off in heavyweight ITC. The tobacco giant's shares plummeted after the government notified a significant hike in excise duties on cigarettes, effective February 1, triggering a wave of profit booking across the defensive pack.

Stock-specific action saw Coal India leading the gainers' list on the NSE with a jump of over 7 per cent, reflecting strong energy demand. Larsen & Toubro (L&T) also grabbed headlines by hitting a record high of Rs 4,164.20. The infrastructure major’s ascent followed the announcement of "major" EPC orders from the Steel Authority of India (SAIL) for its expansion projects in West Bengal and Jharkhand. This boost to L&T's already massive Order Book underscores the continuing momentum in India’s industrial and metallurgical capital expenditure.

Automobile stocks, including Maruti Suzuki and Mahindra & Mahindra, provided additional fuel to the rally, supported by healthy December sales figures. The broader market participation was equally encouraging; the Nifty Midcap 100 and Smallcap 100 indices ended in the green, with an advance-decline ratio clearly favouring the bulls. Out of over 3,200 stocks traded on the NSE, more than 2,200 recorded gains, signalling that the rally was not just restricted to the heavyweights but was felt across the wider market ecosystem.

Looking ahead, while the India VIX edged higher to 9.45, indicating a slight uptick in volatility, the market’s underlying structure remains constructive. Investors are now shifting their focus toward the upcoming Q3 earnings season and pre-budget expectations. With the Nifty maintaining its position above the crucial 26,100 mark, analysts believe that sustained domestic institutional inflows and positive corporate updates could pave the way for further record-breaking milestones in the coming weeks.

Mid-Day Market

The Indian equity markets are trading at the day's high today, with the Sensex surging over 400 points to cross the 85,600 mark and the Nifty approaching 26,300. This momentum is supported by broad-based buying, as advancing shares outpace decliners by a ratio of nearly 2:1. While the FMCG index faced slight pressure, sectors like Auto, Metal, and PSU Banks are seeing gains between 0.5 per cent and 1 per cent. Notably, the Nifty Bank index hit a fresh record high of 60,118, reclaiming the spotlight as markets head toward a strong weekly close.

In corporate developments, several mid-cap and Small-Cap players are witnessing significant activity following key business updates. Aurobindo Pharma gained over 1 per cent after announcing a Rs 325 crore acquisition of Khandelwal Laboratories' non-oncology business. Time Technoplast shares jumped more than 4 per cent on receiving PESO approval for its high-pressure Type-3 cylinders, while Avantel secured a new purchase order from Bharat Electronics. Additionally, Sandur Manganese hit a 52-week high, and Olectra Greentech rose 6 per cent after commencing operations at its new Telangana EV plant.

The electric vehicle and automotive sectors are particularly buoyant today. Ola Electric Mobility shares climbed 9 per cent, extending a two-day surge following a sharp increase in December market share. Tata Motors also hit a record high on the back of strong monthly sales figures, while Ashok Leyland extended its winning streak for a fifth consecutive day. Despite the exuberance in the equity market, the Indian Rupee faced some pressure, slipping to a day's low of 90.12 against the US Dollar.

Opening Bell   

The Indian equity markets commenced the first trading session of 2026 with a cautious yet positive bias, as the Nifty 50 hovered above the 26,200 mark. Despite the initial optimism, the 26,200 level remains a formidable barrier for the index, while downside risks appear well-cushioned with strong support established at 26,000 and 25,800. This 25,800 level marks the lower boundary of a two-month trading range, providing a safety net for bulls. Although trading volumes have been thin due to the holiday season, market activity is expected to pick up as foreign institutional investors return to their desks, potentially breaking the current range-bound movement.

The new year's start was notably dampened by a sharp decline in ITC, which single-handedly shaved off 100 points from the Nifty. The conglomerate’s shares faced a steep 10 per cent intraday crash following the government's announcement of a new excise duty on cigarettes, effective February 1, 2026. This Tax hike, ranging from Rs 2,050 to Rs 8,500 per 1,000 sticks, has triggered a wave of downgrades and target price cuts by analysts who fear a significant impact on the company's operating margins and cigarette volumes. While ITC struggled, the broader market found some solace in the banking sector; despite a lacklustre performance from ICICI Bank, the Nifty Bank managed to sustain above the critical 59,500 level.

Focus has shifted toward mid-cap financial names and the automotive sector following recent business updates. PSU lenders like Punjab & Sind Bank reported a healthy Q3 update with total business growing 11.84 per cent year-on-year to Rs 2.49 lakh crore, leading to a 2 per cent jump in their share prices during early Friday trade. Simultaneously, the auto sector is reacting to December sales data. Bajaj Auto reported a 14 per cent year-on-year increase in total sales at 3.69 lakh units, though this slightly missed some analyst estimates. Other key players like Maruti and Mahindra & Mahindra saw gains of up to 1.4 per cent, supported by strong passenger vehicle demand and optimistic macroeconomic indicators.

On the currency front, the Indian rupee showed signs of recovery, opening at 89.93 against the US dollar compared to its previous close of 89.96. The currency's slight appreciation of 6 paise in early trade reflects a breather after a volatile 2025. Investors are now closely monitoring foreign portfolio investor (FPI) activity, as their return is deemed crucial for sustaining the market’s upward trajectory. With December GST collections showing a 6.1 per cent year-on-year growth to Rs 1.75 lakh crore and the Q3 earnings season around the corner, domestic fundamentals continue to be the primary driver for Indian equities amidst a quiet global backdrop.

Pre-Market commentary

Indian equity markets are poised for a constructive start this Friday, with the Sensex and Nifty 50 expected to open in positive territory. This optimism is fuelled by steady global signals and a 41-point gain in the Gift Nifty, which is currently trading around the 26,330 level. Supporting the domestic sentiment is the latest fiscal data showing that India’s GST collections rose 6.1 per cent year-on-year to Rs 1.75 lakh crore in December 2025, driven by robust imports and internal economic momentum. While Foreign Institutional Investors (FIIs) began the 2026 trading year as net sellers—offloading Rs 3,268.60 crore—Domestic Institutional Investors (DIIs) provided a cushion by purchasing Rs 1.525.89 crore in equities.

The market enters today's session following a relatively flat performance on New Year's Day. On Thursday, the Nifty 50 stayed nearly unchanged at 26,146.55, while the Sensex saw a minor dip to 85,188.60. Despite the narrow movement in the main indices, sectoral performance was largely positive, with nine out of eleven indices ending higher. The Auto, Realty, and IT sectors showed strength, whereas the FMCG sector faced its sharpest decline since early 2022. Notably, market volatility remained historically low, with the India VIX closing near 9.2, and Mid-Cap stocks continued to outperform their Large-Cap peers.

Internationally, the landscape is shaped by a weakening US Dollar and rising commodity prices. The US Dollar Index has slipped to 98.18, allowing the Indian rupee to strengthen slightly to 89.96 against the greenback. Investors are currently adopting a "wait-and-watch" approach regarding interest rate signals. Meanwhile, safe-haven assets are seeing a massive surge; gold has reached unprecedented highs near $4,346 per ounce, and silver has jumped over 2 per cent. In the energy sector, oil prices remain stable but cautious, with Brent crude hovering around $60.88 as traders balance supply concerns against a moderate global demand outlook.

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