Market Updates: Sensex Surges 500 Points, Nifty Trades Near 23,800; Banking Stocks Lead

Stock Market Today, May 22: The domestic equity market extended gains in the early trade on Thursday, supported by strong buying in banking and financial stocks amid positive global cues. At 10:10 am, the Sensex was up 519 points, or 0.69%, at 75,702, while the Nifty 50 climbed 140 points or 0.58% to 23,792.

Financial stocks led the market rally, with the Nifty Bank index surging 1.17% to 54,065. The Nifty Private Bank index jumped 1.39%, emerging as the top-performing major sectoral gauge.

ICICI Bank, HDFC Bank, Axis Bank and Kotak Mahindra Bank were among the biggest contributors to the gains. Nifty Financial Services also rose 1.23%, reflecting broad-based strength in lenders and NBFCs.

Largecaps Outperform Broader Market

The rally remained concentrated in frontline stocks, while

broader markets underperformed. Nifty Midcap 100 slipped 0.13%, while Nifty Smallcap 100 declined 0.13%, indicating profit-booking in the broader market after recent outperformance.

The divergence between largecaps and SMIDs became more visible during the early session as investors shifted towards relatively safer heavyweight stocks.

Pharma, Media, Realty Under Pressure

Sectorally, healthcare and media stocks witnessed sharp selling pressure. The Nifty Healthcare index dropped 1.21%, while Nifty Pharma fell 0.78%.

The Nifty Media index emerged as the worst-performing sectoral index, declining 1.47%. Realty stocks also remained weak, with the Nifty Realty index falling 0.72%.

Auto, Cement Hold Positive Bias

Auto shares traded with a positive bias, with the Nifty Auto index rising 0.23%. Cement stocks also remained firm as the Nifty Cement index gained 0.63%.

Metal stocks traded largely flat, while FMCG and oil & gas indices showed muted movement.

Volatility Spikes

India VIX jumped 4.53% to 18.63, indicating rising market volatility despite the sharp gains in benchmark indices.

Global Cues Support Sentiment

Global market sentiment remained supportive. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3%, while Japan’s Nikkei advanced 2%.

US stock futures gained 0.2%, while European futures climbed 0.8%, boosting investor confidence across Asian markets.

Analysts’ Take

VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said, “An important recent trend in the market is buy on dips and sell on rallies. Low openings are bought into and high openings are getting sold. Institutional activity must be playing a role in this. Retail traders have to handle this trend very deftly.”

He added that declining Brent crude prices and rupee appreciation are positive for the Indian market.

“Brisk activity is happening in the broader market. Small and midcaps coming out with good results and optimistic growth projections are getting positive response from the market. FII selling and fears of more FII selling are weighing on largecaps despite their relatively cheaper valuations. Momentum is in SMIDs even though safety is in largecaps. This dichotomy will persist till FIIs turn buyers in India,” Vijayakumar said.

Hitesh Tailor, research analyst at Choice Equity Broking Private Limited, said, “Indian equity markets opened on a positive note. Positive global market sentiment, strength across Asian equities, and easing concerns over geopolitical tensions are likely to support overall investor confidence in the near term.”