Indian indices rose for a second day, supported by lower crude oil prices at $72.8 per barrel and a steady interest rate stance from the RBI. However, gains were limited by late-session profit-taking ahead of the upcoming long weekend. While auto stocks outperformed, broader market indices saw a decline as investors turned cautious.
Market Performance and Sentiment
Indian benchmark indices managed to close higher for the second consecutive session on Thursday. The BSE Sensex ended at 77,100.47, gaining 109.25 points, while the NSE Nifty 50 settled at 24,056, up 34.35 points. The trading session started with strong momentum, driven by a sharp decline in Brent crude oil prices to approximately $72.8 per barrel. Lower oil prices generally help reduce inflationary pressure and improve the outlook for India's import-heavy economy.
Investor sentiment was further supported by comments from Reserve Bank of India (RBI) Governor Sanjay Malhotra, who indicated that there are no immediate plans for interest rate hikes. Stable interest rates are typically viewed as positive for consumption and corporate profitability.
Why Gains Were Limited
Despite the positive start, the market could not hold onto its intraday highs. As the trading day progressed, investors began booking profits to secure gains before the upcoming long weekend, as markets in India are set to remain closed on Friday for the Muharram holiday. This late-session selling pressure trimmed the gains for both the Sensex and the Nifty, leading to a largely flat finish for the day.
Auto Outperformance vs. Metal and IT Weakness
Sectoral trends showed a clear divide. The Nifty Auto index was the standout performer, rising 2.25%. This strength was driven by easing supply chain constraints, lower input costs like metal prices, and steady retail demand. On the other hand, the Nifty Metal index fell by 1.37%, and the Nifty IT index declined by 0.86%, as these sectors faced selling pressure throughout the session.
Broader Market Caution
While the benchmark indices remained in the green, the broader market showed signs of hesitation. Both the Nifty Midcap 100 and Nifty Smallcap 100 indices ended the day in negative territory, falling 0.55% and 0.47% respectively. This indicates that participants in mid-sized and smaller companies were more active in locking in profits compared to those trading in large-cap stocks.
Weekly Performance and Outlook
Despite the mild profit-taking on Thursday, the Indian markets concluded a successful week. This session marked the third consecutive weekly advance for both the Sensex and Nifty, representing the strongest weekly performance of 2026 so far. The market has been aided recently by a combination of falling oil prices, central bank measures to support the rupee, and sustained foreign capital inflows. The key monitorable for investors when markets reopen will be whether the momentum in large-cap stocks can continue or if profit-booking persists in the broader market.