Indian equities ended higher on Tuesday, with the Sensex rising 287 points to close at 77,656 and the Nifty gaining 116 points to settle at 24,335. The market wrapped up its first monthly series under the Closing Auction Session (CAS) on a positive note, with the Nifty gaining 1.5% during the August series.

Key Highlights

• Sensex gains 287 points while Nifty rises 116 points, closing at two-week highs after a strong late-session recovery.
• Nifty August series gains 1.5%, supported by ICICI Bank, Reliance Industries and L&T amid softer crude prices.

The Nifty ended above the 24,300 mark after a last-hour surge helped the index recover more than 200 points from the day's lows, closing at a two-week high. ICICI Bank, Reliance Industries and L&T were among the top contributors to the day's gains.

Broad Market Breadth Stays Mixed Despite Gains

More than 35 Nifty stocks closed higher, with Adani Enterprises and Max Healthcare among the top gainers. However, overall market breadth favoured declines, with the advance-decline ratio at 4:5.

The Nifty Bank slipped marginally by 12 points to 57,514, while the Midcap index rose 346 points to 64,163. A favourable move in the rupee and softer crude oil prices supported stocks such as Shriram Finance and IndiGo, both of which gained 2%.

Stock-Specific Action: Vodafone Idea, Paytm Shine

In stock-specific moves, Vodafone Idea surged 8% on healthy trading volumes, while Paytm gained 6% and closed above Rs 1,700 per share for the first time in nearly five years.

Sources indicated that Federal Bank may acquire a majority stake in Jana Small Finance Bank, with Federal Bank's own stock ending 3% lower on the news. Hindustan Zinc slipped 2%, despite the DIPAM Secretary confirming there would be no offer for sale in the near term for the stock.

Hindustan Copper fell 7% after the government launched an offer for sale (OFS) to divest a 3% stake, with an additional 3% greenshoe option, at a floor price of Rs 514 per share — a 9.5% discount to Monday's closing price. The non-OFS portion of the offering was fully subscribed. IREDA, meanwhile, rose 5% after a sharp move in the final hour of trade, with Angel One, Laurus Labs and Indus Towers also among the top midcap gainers.

Rupee Strengthens, Gold Nears Three-Month High

Indian rupee closed at 95.41 against the US dollar, strengthening from Monday's close of 95.75. Globally, gold prices continued their rally, rising more than 17% since July 17, with market participants attributing the move to renewed interest in the "debasement trade," as investors sought protection against the prolonged effects of rising government debt and liquidity injections.

Analyst and Expert Commentary

Jai Bala, CMT at Cashthechaos.com, said the Nifty has held the 24,100-24,050 support zone, and a close above the 24,350-24,500 range would be a positive signal for the market. He remained bullish on gold, expecting fresh record highs, and said he was more bullish on gold than silver, while projecting Bitcoin could head toward $145,000.

Raman Jauhar, Managing Director and Head of Equities at Axis Capital, said market sentiment had improved significantly from four months ago, with large-cap companies capable of delivering double-digit earnings growth. He noted that staples were seeing 15% topline growth after a long gap, while the QSR segment saw volume growth and paint companies also performed well. Jauhar added that FII flows had turned positive over the past two months, with emerging market and global benchmark funds moving to a neutral stance on India from an earlier underweight position.

Varun Goel, Senior Fund Manager at Mirae Asset Mutual Fund, noted that large-cap companies delivered healthy 15% earnings growth in Q1, while small-caps saw 30% growth and are expected to post 25% growth in FY27. He remained positive on diagnostics, hospitals, CDMOs and auto ancillaries, citing improving earnings amid muted sentiment as a good setup for bottom-up stock picking.

Key Corporate and Sector Developments

Federal Bank confirmed it continuously evaluates growth opportunities but stated there was no material information requiring disclosure at this stage regarding the Jana Small Finance Bank deal.

Arunish Chawla, DIPAM Secretary, said the timing of the Hindustan Copper OFS was optimal, adding that the government's stake in the company would fall to 60% from 66% following the current transaction. He also expressed confidence in achieving the Rs 80,000 crore divestment target set for FY27, and noted investors had already gained 10% in LIC shares following its earlier stake sale.

Defence Minister Rajnath Singh approved the transfer of DRDO-developed conventional missile system technologies to India's domestic defence industry for local production.

Afcons Infrastructure shares jumped as much as 4.4% after the company received a Rs 335.50 crore arbitral award in a dispute with the Uttar Pradesh Expressways Industrial Development Authority (UPEIDA).

Also Read: Indian Stock Market Ended Lower as Sensex and Nifty Decline

Broader Market Outlook

Sakshi Gupta, Vice President and Senior Economist at HDFC Bank, said she expects GDP growth to remain strong, supported by a renewed pickup in consumer demand, though she flagged potential risks to agricultural production from heatwaves in northern India. She noted that investors remain cautious on private capex amid the ongoing West Asia conflict, even as government capex remains strong.

Soumya Kanti Ghosh, Group Chief Economic Advisor at SBI, said all indicators point toward higher GDP growth forecasts, projecting 8% growth in the first quarter, while expecting overall nominal GDP growth to moderate to 13-13.5% for the full year, against earlier expectations of 14%.