Stock market today: Nifty 50, Sensex close flat in volatile trade; IT stocks show resilience

The Indian stock market closed the volatile trading session on a flat note on Tuesday, October 1 amid mixed global signals and uncertain economic indicators. While some stocks posted slight gains, the overall sentiment remained cautious. Traders opted to remain on the sidelines as they evaluated the potential impact of the recovery in Chinese stocks, while also keeping an eye on upcoming economic data and corporate earnings reports.

The Nifty 50 closed the session 0.05% lower at 25,796 while the Sensex ended with a slight decline of 0.04% at 84,262. In contrast, the mid-and small-cap indices outperformed their large-cap counterparts, with the Nifty Midcap 100 index rising 0.34% and the Nifty Smallcap index posting a gain of 0.79%.

In today’s session, 22 out of the 50 Nifty constituents finished in the positive territory. Tech Mahindra led the rally with a 3.1% gain, followed by M&M and Britannia Industries, which rose 2.3% and 1.7%, respectively.

Other top gainers included Adani Enterprises, Infosys, Coal India, Kotak Mahindra Bank, Adani Ports & Special Economic Zone, State Bank of India, HCL Tech, Wipro, and Hero MotoCorp, all closing with gains exceeding 1%.

Among the sectoral indices, Nifty Media topped the charts with a 1.52% gain, followed by Nifty IT, Nifty Metal, and Nifty Auto, which recorded a rise of 1.17%, 0.25%, and 0.2%, respectively.

Vinod Nair, Head of Research, Geojit Financial Services, said, "Triggered by the recent stimulus policies by the Chinese central bank, funds are shifting to cheaper Chinese stocks from expensive markets like India. This, along with the possible increase in interest rates by the BoJ due to recent political changes, may impact the domestic market in the near term.

"The recent data on the output of the key infrastructure segments and manufacturing activities is showing some fragility. Meanwhile, OPEC’s plans to increase production are resulting in the oil prices falling. Domestically, the market awaits the upcoming RBI's policy meeting and Q2 results to have further insights on market trajectory," he added.

Positive commentary from Jerome Powell boosts IT stocks

IT stocks closed higher in today’s trading session following remarks from Federal Reserve Chair Jerome Powell, who suggested that the US central bank might consider further rate cuts, although it is not bound by a preset course of action.

Powell clarified that the 50-basis point cut made in September should not be interpreted as a signal for aggressive future moves, emphasising that the Fed will make decisions based on a meeting-by-meeting evaluation of data and the prevailing balance of risks.

The Nifty IT index ended at 42,434 — up 1.17% over its previous close.

Among the index constituents, three stocks ended in the positive territory, with Tech Mahindra leading the way, gaining 3.1%. This uptick was also influenced by an upgrade from CLSA, which raised its rating on the stock to 'outperform' from 'hold.' The global brokerage firm also increased its target price for Tech Mahindra to ₹1,749 per share, up from the previous target of ₹1,626.

In addition, Japanese brokerage firm Nomura adjusted its target price for the stock to ₹1,900 per share from ₹1,600 while maintaining a 'buy' rating.

Paytm shares hit 8-month high

The remarkable recovery in Paytm shares continued today as well. The stock surged nearly 8% to an eight-month high of ₹745 per share after domestic brokerage Dolat Capital increased its target price on the stock to ₹920 while maintaining its ‘buy’ rating. 

The brokerage said several key developments over the past three months indicate easing challenges and improving prospects across Paytm's business segments. The brokerage believes that Paytm is on track to achieve adjusted EBITDA breakeven by Q4 FY25 (excluding UPI incentives), with positive cash flow anticipated in the near future.

M&M PV sales jump 24% 

Mahindra & Mahindra on Tuesday reported total auto sales at 87,839 vehicles for the month of September 2024, registering a rise of 16% from 75,604 vehicles in the same month last year.

Its Passenger Vehicles (PV) sales stood at 51,062 units in the domestic market, a growth of 24% from 41,267 units sold in September 2023. Overall, in the utility vehicles segment, the auto major sold 52,590 units, including exports.

Amid strong sales figures, the stock closed the day up 2.3% at ₹3,165 per share.

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