The NIFTY50 index recovered to 23,271, gaining 53 points after experiencing significant volatility during Thursday's trading session. According to latest market data, the index closed near 23,271 following a dramatic intraday swing where Sensex dropped over 273 points from its closing auction session high of 74,588 to close at 74,315, recording a 22-point loss for the day. The recovery demonstrates domestic investors' ability to absorb the Fed decision better than pre-market signals indicated, though higher US interest rates, crude oil above $100 and foreign investor selling continue to present challenges for Indian equities. Market analyst Vipin Dixena identified 23,100–23,070 as an immediate support zone for the Nifty, noting that a hold above this area could support a move towards 23,400–23,500, while a break below 23,070 could bring 23,000 into focus.
ICICI Bank emerged as a key driver of the market rally, alongside other major banking stocks including HDFC Bank, Axis Bank, and Reliance Industries, as reported by Upstox Securities. The banking sector's strong performance reflects investor confidence in the financial services sector and its ability to deliver consistent returns. Nifty Bank advanced 0.23% while Nifty Private Bank gained 0.32% in the latest trading session. The sector's resilience is particularly notable given the challenging global macroeconomic backdrop following the Fed's rate hike decision. Bank Nifty also recovered, rising to 56,570 after touching 56,072 earlier in the session, demonstrating broad-based strength across banking and financial stocks.
The Nifty IT index fell around 0.5% at the open as investors assessed the impact of higher US interest rates on technology spending. As per market analysts, Indian IT companies generate a substantial share of their revenue from US clients, leaving the sector sensitive to changes in the American economic outlook. The Fed's decision to signal that the tightening cycle may not be finished, with 16 of 18 Fed officials expecting at least one additional 25-basis-point increase before the end of 2026, has raised concerns about potential delays or reductions in discretionary technology projects. This makes IT one of the sectors most directly exposed to the Fed's renewed tightening cycle, particularly if policymakers deliver another rate hike before the end of the year.
Broader markets significantly outperformed the benchmark indices, with Nifty Midcap 100 and Nifty Smallcap 100 indices closing up to 1% higher after taking a sigh of relief after a sharp selloff. Among sectoral indices, Nifty Pharma rallied around 2%, while Nifty Realty, Nifty Auto and several other indices gained around 1% each. Nifty Metal advanced 0.51% while Nifty Auto gained 0.45%, reflecting strong performance across multiple sectors. The overall market breadth turned positive, with NSE seeing 2,262 advances against 1,279 declines, while 110 stocks remained unchanged, showing the market's resilience in absorbing the Fed decision. Eight of the 16 major sectoral indices were initially lower before the recovery, demonstrating broad-based strength across market capitalizations.
The NIFTY50 index closed near 23,271 led by index heavyweights across multiple sectors, as reported by Upstox Securities. The strong performance was attributed to ICICI Bank, L&T, HDFC Bank, Bharti Airtel, Eternal, Reliance Industries and Axis Bank, demonstrating broad-based strength across banking, infrastructure, and technology sectors. Brent crude eased slightly, with prices around $105, offering some relief to India, though prices remain exceptionally elevated at $105-$106 per barrel. The Fed's first increase in more than three years continues to present challenges for Indian equities, as higher US rates can make dollar-denominated assets relatively more attractive and reduce foreign investor appetite for emerging markets. A sustained move above 23,300 could strengthen the rebound and bring 23,400 into focus, while the 23,200 region remains the first important support area.
