Sensex jumps 300 pts, Nifty tops 24,650; defence stocks lead rally

Indian equity benchmarks broke out of a narrow consolidation phase on Thursday, with the Sensex climbing over 300 points in early trade. The 30-share index moved past its recent trading band, while the Nifty crossed the 24,650 level, helped by strong buying in defence and capital goods stocks.

The rally comes after several sessions of range-bound movement, as investors awaited fresh triggers. Market participants pointed to sustained domestic flows and positive global cues as key drivers behind the upmove.

Defence stocks lead the charge

Defence shares emerged as the standout performers, with several frontline names in the sector gaining sharply. Traders attributed the strength to expectations of fresh order inflows and policy support for domestic manufacturing.

The broader market also showed resilience, with midcap and smallcap indices trading higher. Sectoral indices on the National Stock Exchange were mostly in the green, with capital goods and industrials joining the defence rally.

Breadth improves, volatility eases

Market breadth turned positive, with advancing stocks comfortably outpacing decliners on the BSE. The India VIX, a gauge of near-term volatility, eased, reflecting improved investor sentiment.

Foreign institutional investors remained net buyers in recent sessions, according to provisional exchange data. Domestic institutional flows also stayed supportive, providing a cushion against any sharp corrections.

What is driving the momentum

Analysts said the breakout above the recent range could attract fresh buying from momentum traders. The Nifty’s move past 24,650 is being watched as a key technical level, with the next resistance seen around the 24,800–25,000 zone.

Global cues were supportive, with Asian markets trading firm after a positive close on Wall Street overnight. Easing crude oil prices also aided sentiment, as India is a major importer of the commodity.

However, some traders advised caution, noting that the rally could face headwinds from global central bank policy moves and domestic inflation data due later this month.

Sectoral action and stocks to watch

• Defence and aerospace stocks led gains, with several counters hitting fresh 52-week highs.
• Public sector undertakings, particularly those in the defence space, saw heavy buying interest.
• Banking and financial stocks traded mixed, with private lenders showing resilience.
• IT stocks remained subdued, as investors rotated into cyclicals and industrials.

Among individual stocks, a leading defence PSU was among the top gainers on the Nifty, while a private bank heavyweight contributed the most to the Sensex’s rise.

Analysts said the market’s focus would now shift to corporate earnings and macroeconomic data, with the upcoming inflation print likely to influence rate expectations.

As the session progresses, traders will watch if the Nifty can sustain above 24,650 and build on the momentum. A close above this level could signal further upside in the near term, while a slip back into the range may invite profit-booking.

For now, the bulls appear to be in control, but with global uncertainties persisting, the sustainability of this breakout remains the key question for the rest of the week.