Markets staged a strong recovery on Wednesday, with the Nifty 50 closing above its crucial 20-day exponential moving average for the first time since July 11, as optimism over global trade developments and selective sectoral strength drove buying interest across major indices.
The Nifty 50 gained 159 points or 0.63 per cent to close at 25,219.90, while the Sensex surged 539.83 points or 0.66 per cent to end at 82,726.64. The benchmark indices opened higher with Nifty starting at 25,139.35 against its previous close of 25,060.90, and Sensex opening at 82,451.87 compared to the previous close of 82,186.81.
“For the first time since July 11, the index has successfully closed above its 20-day EMA — a crucial technical indicator often monitored by traders,” said Sudeep Shah, Head – Technical Research and Derivatives at SBI Securities. “Over the past few sessions, the index had repeatedly tested this moving average but failed to sustain above it. However, Wednesday’s close above the 20-day EMA could signal a potential shift in short-term sentiment.”
Auto and banking stocks led the rally, with Tata Motors emerging as the top gainer on Nifty 50, surging 2.60 per cent to close at ₹690.90. Bharti Airtel followed with a 2.20 per cent gain to ₹1,948.70, while Shriram Finance rose 2.16 per cent to ₹654.00. Apollo Hospital gained 1.97 per cent to ₹7,389.00, and Bajaj Finance advanced 1.62 per cent to ₹968.00.
On the downside, Tata Consumer Products led the losers, declining 1.92 per cent to ₹1,064.00. Hindustan Unilever fell 0.92 per cent to ₹2,456.80, Infosys dropped 0.76 per cent to ₹1,558.90, Grasim declined 0.70 per cent to ₹2,703.70, and BEL shed 0.62 per cent to ₹400.60.
“Markets rallied sharply on Tuesday, with the Sensex rising 540 points and the Nifty closing at 25,220, led by auto, banks, and metal stocks,” noted Vikram Kasat, Head – Advisory, PL Capital. “Tata Motors and Airtel were among the top Nifty gainers, each up nearly 2 per cent.”
Global trade developments provided the key catalyst for the day’s gains. “The Indian stock market commenced today’s session on a distinctly positive trajectory,” according to Ashika Institutional Equities’ market commentary. “On the global stage, investor sentiment soared following optimistic developments surrounding the US-Japan trade pact, igniting expectations for further international agreements in the near future.”
Sectoral performance remained mixed with banking, financial services, automobiles, and healthcare leading gains, while realty, media, consumer goods, and metals witnessed selling pressure. The Nifty Healthcare and Nifty Auto indices led sectoral gains, while Nifty Realty and Nifty Media ended in the red.
Market breadth showed a positive bias with 1,732 advances against 2,095 declines among 4,016 traded stocks on BSE. Notably, 129 stocks hit 52-week highs while 40 touched 52-week lows. Additionally, 195 stocks were in upper circuit while 171 were in lower circuit.
The rupee continued to face pressure against the dollar, with currency analysts expressing caution. “The Indian Rupee continued to weaken against the US Dollar, with the USD/INR pair climbing toward 86.50 at the start of the week, its highest in four weeks,” said Riya Singh, Research Analyst at Emkay Global Financial Services. However, Jateen Trivedi from LKP Securities noted that “Rupee traded flat in a narrow range near 86.40, with marginal movement of 0.01 per cent against the dollar.”
In commodities, gold prices remained elevated with domestic prices trading near ₹1,03,500 on MCX. “Gold prices remained range-bound near higher levels, with MCX trading close to ₹1,03,500, taking cues from Comex gold, which held steady around $3,424,” Trivedi said.
The derivatives segment showed bullish sentiment with notable open interest accumulation observed in counters such as Lodha, Oberoi Realty, 360 ONE, IRFC, and Colgate-Palmolive, signaling heightened investor activity.
“Markets traded with a positive bias and gained over half a percent, offering some relief after the recent decline,” said Ajit Mishra, SVP Research at Religare Broking. “The ongoing recovery is being driven primarily by strength in banking majors, while heavyweights from other key sectors are showing signs of stabilization following the recent correction.”
Technical analysts remain optimistic about the near-term outlook. “Now, the Nifty is trading above both its short-term and long-term moving averages — a technically bullish signal that indicates strengthening momentum,” Shah added. “Given these developments, we believe the index is well-positioned to extend its pullback rally over the next few trading sessions.”
Looking ahead, market participants will closely monitor corporate earnings announcements, particularly from Infosys and Dr Reddy’s, which are scheduled to release quarterly results. “Participants will closely watch Infosys’ results, as its performance will be crucial in determining the next leg of the move for the IT space,” Mishra noted. The focus will also be on upcoming US Manufacturing and Services PMI data and next week’s US interest rate decision for further market direction.
Published on July 23, 2025
