Market Wrap

Indian equity markets remained resilient on September 18 despite a challenging global backdrop following the U.S. Federal Reserve’s 25-basis-point rate hike. The Nifty 50 recovered from intraday weakness and closed 0.23% higher at 23,270.60, while the Sensex ended marginally lower after a volatile session.

Healthcare stocks emerged among the key outperformers, recovering from a false breakdown near important support levels. The rebound suggests that selling pressure may have weakened and fresh buying emerged at lower levels. Autos and select stocks also attracted buying interest, helping the broader market absorb the pressure from global cues.

The key global trigger remains the Federal Reserve’s decision to raise rates to 3.75%-4%, its first rate hike since 2023. The accompanying commentary remained relatively hawkish, with inflation still elevated and the possibility of another hike this year remaining on the table. While Wall Street initially reacted negatively, Asian markets demonstrated resilience, and Indian equities managed to absorb the Fed shock relatively well.

Domestically, attention has also shifted toward the ₹22,562-crore NSE IPO, which opened on September 18 and will remain open until September 21. Subscription trends could influence sentiment across exchange, brokerage and capital-market stocks during the issue period.

However, rising crude prices, a stronger dollar and elevated U.S. bond yields remain important external risks, particularly for foreign portfolio flows and rate-sensitive segments of the Indian market.

What's Ahead

The next session will be important in determining whether the market’s recovery can sustain following the Fed’s policy shift. Traders will closely watch U.S. bond yields, crude oil prices, the rupee, FII activity and further Fed commentary for signals on global liquidity and risk appetite.

The NSE IPO subscription trend and stock-specific buying could provide additional domestic catalysts. With the Federal Reserve maintaining a tightening bias, volatility is likely to remain elevated. The market’s ability to hold key support levels while sustaining buying interest at lower levels will remain an important signal for the near-term trend.

Market Snapshots

Institutional Activity

Sectoral Performance

Technical Outlook

Nifty 50

The NIFTY 50 gained 99 points (+0.43%) to close at 23,217.60 after moving between 23,116.10 and 23,284.75. The index witnessed a recovery from lower levels, supported by buying across banking, metals, consumer and select auto stocks, while weakness in IT stocks limited the upside. The RSI has recovered from deeply oversold levels but remains below 30, indicating that the index is still in the oversold zone and that the current rebound requires confirmation. Near-term support is placed at 22,939 and 22,766, while 23,496 and 23,669 remain key resistance levels. The market could remain volatile, particularly with elevated crude prices and the U.S. Federal Reserve’s policy decision acting as important external triggers.

BankNifty

The NIFTY BANK advanced 497.70 points (+0.89%) to close at 56,292.45, recovering after the previous session’s selloff. The index traded between 55,812.20 and 56,368.70, with broad-based buying across private and PSU banks supporting the recovery. The RSI has improved from multi-week lows and is now near 40, indicating that momentum has recovered but remains relatively weak. The index faces immediate resistance at 56,841 and 57,181, while 55,744 and 55,404 are the key support levels. Sustaining above the immediate support zone could help stabilize the short-term trend, while a move beyond resistance would provide further confirmation of recovery momentum.

NIFTY FINANCIAL SERVICES

The NIFTY Financial Services index gained 185.75 points (+0.74%) to close at 25,262.40, supported by broad-based buying across banks, NBFCs and insurance stocks. The positive breadth, with 13 stocks advancing against 7 declining, indicates relatively broad participation in the recovery. However, weakness in stocks such as CHOLAFIN, BAJAJFINSV and BSE capped the advance. The index has near-term support at 24,923 and 24,713, while 25,602 and 25,812 are the key resistance levels. The index remains in a recovery phase, with sustained buying required above the resistance zone to strengthen the near-term technical setup.

Sensex

The SENSEX advanced 332.63 points (+0.45%) to close at 74,336.45, supported by buying in banking, consumer and select industrial stocks. The index traded with a positive bias and market breadth remained constructive, with 18 stocks advancing against 9 declining. However, weakness in IT stocks limited the overall upside. Near-term support is placed at 73,460 and 72,918, while resistance is seen at 75,213 and 75,755. The recovery indicates improved buying interest at lower levels, but the index would need to sustain above immediate support and overcome the resistance zone to establish stronger short-term momentum.