The Nifty 50 on Friday closed at 24,383, up 0.27 per cent or 66 points, extending its winning streak to a third consecutive session and logging a weekly gain of 2.59 per cent. The Sensex settled at 78,094, up 0.21 per cent and posted a weekly gain of 2.67 per cent.
However, the bigger story is their monthly performance. Nifty and Sensex jumped 2.2 per cent and 2.1 per cent respectively for July, posting consecutive monthly advances for the first time this year, as IT stocks rallied sharply with the NIfty IT jumping 16.77 per cent, its strongest monthly performance in six years. HCL Tech surged 25.6 per cent while other IT major such as Infosys, TCS and Tech Mahindra moved up to 18 per cent.
Broader, Nifty small-cap and mid-cap indices also surged 2.5 per cent and 1.8 per cent for the month.
Indian equities outperformed several global indices despite a jump in crude oil prices owing to renewed optimism in traditional IT stocks, said Ankur Punj, MD & Business Head at Equirus Wealth. “While the Nifty IT index has rallied around 17 per cent this month, the Q1 earnings of most of the frontline tech firms were in line with estimates which helped regain investors confidence,” he said.
Also, the initial AI success which had triggered a massive rally in Asian indices like Kospi, Taiwan seem to have subsided over the past few weeks, resulting in a recovery in domestic IT stocks, he added.
FPI return
Another highlight was the behaviour of foreign portfolio investors. FPIs, who pulled out almost $30 billion from Indian equities in the first six months of the year, turned buyers in July. They bought shares over $2 billion in July.
SBI Securities in a note said sentiment was supported by improving FII inflows, healthy domestic macros and an active earnings season, although gains were partially capped by global uncertainty and geopolitical tensions.
According to Vinod Nair, Head of Research, Geojit Investments Ltd, positive momentum continued, although some profit booking emerged at higher levels as caution persisted amid elevated yields and potential rate-hike concerns. “The sustainability of the recovery will depend largely on the ongoing earnings season, which is currently outperforming forecasts, and on a reduction in global risks,” he said.
On Friday, Bajaj Finance, Bajaj Finserv and Jio Financial Services were the top Nifty gainers, while TCS, Infosys and Eternal dragged.
earnings gave markets a clear direction. The non-banking finance major’s 28 per cent jump in quarterly profit, with gross NPAs slipping below 1 per cent, sparked an 8 per cent surge in the stock on Friday, pulling the entire financial services pack higher and setting the tone for a broadly positive session. “Today belonged to one result and one company,” said Sarvam Goel, Founder, Pocketful, adding “…Bajaj Finance’s numbers are a green light on India’s consumption and credit story.”
Sectoral performance
Sectoral performance was mixed, but tilted green. Media, Auto and Financial Services led the gains on Friday . stronger-than-expected Q1 results underpinned the auto rally, with the Nifty Auto index emerging as one of the session’s best performers. The IT sector, however, was the notable laggard, declining over 1.5 per cent on profit-booking after a five-session rally. Despite Friday’s correction, Nifty IT remains on course for its strongest monthly performance in nearly six years, up over 16 per cent in July.
Broader markets closed modestly higher on Friday. Both the Nifty Midcap 100 and Smallcap 100 gained 0.44 per cent each, with the BSE advances-declines ratio at 1.55, signalling renewed buying interest. India VIX declined over 3 per cent, reflecting easing volatility expectations.
The rupee strengthened 30 paise to close at 95.38 against the dollar, supported by foreign capital inflows, a softer dollar index and lower crude prices. The dollar retreated after the Bank of Japan intervened in the currency markets, pushing the dollar index to a six-week low of 99.9. Spot USDINR has immediate support at 94.85 and faces resistance near 95.60, according to HDFC Securities.
On commodities, gold eased back below $4,060 after touching a one-week high of $4,120 on Thursday, when the Fed held rates for a fifth straight meeting, though via a hawkish 9-3 vote, with three members pushing for a hike. Fed Chair Kevin Warsh said the hold was not a sign of policy drift and left the door open for future hikes. Silver hovered near $58. Both metals are on track for their first monthly gain in months.
Oil stayed under pressure. Brent slipped near $88 and WTI near $82, as Strait of Hormuz vessel crossings picked up sharply under US naval escort, with Qatar sending its first LNG cargo through the strait in three weeks. Despite improved flows, the US-Iran standoff remained diplomatically unresolved, keeping the geopolitical risk premium intact. Both benchmarks are still headed for a roughly 20 per cent monthly gain, reflecting how deeply supply fears were priced in through July.
The week ahead is event-heavy. Markets will watch the RBI’s monetary policy decision, India’s Manufacturing and Services PMI data, and Hormuz traffic developments closely. Key earnings, Divi’s Laboratories, Persistent Systems, AU Small Finance Bank and CDSL, will also be in focus. Nifty’s next resistance sits in the 24,500–24,550 zone; a clean breakout there could open the path toward 24,700 and beyond.