Indian Markets Snap 8-Day Rally, Nifty Ends Below 25,100; Midcaps, Smallcaps Shine

Indian equity markets snapped a eight-session gaining streak to end lower, with the Nifty index failing to hold the 25,100 mark.

India’s annual wholesale inflation rate turned positive in August, rising to 0.52% compared to -0.58% in July. After two months of contraction, it increased due to a rise in prices of food products and manufactured goods. 

On Monday, the Sensex closed 118 points lower at 81,785, while the Nifty 50 ended down 44 points at 25,069. Broader markets outperformed, with the Nifty Midcap index rising 0.4% and the Smallcap index gaining 0.7%. 

The retail investor sentiment surrounding the Nifty 50 was ‘bullish’ by market close on Stocktwits.

Stock Moves

Sectorally, technology and pharmaceuticals saw selling pressure, while real estate, PSU banks, and energy stocks gained on Monday. 

Defense and railway stocks saw strong gains. Railtel surged 7% on an order win, followed by 7% gains in IRCON as well. 

Shares of Anant Raj surged 13% after reports emerged that the Indian government is considering incentives for data centre developers. 

KRBL fell 10% after independent director, Anil Kumar Chaudhary, resigned on Sunday, citing significant corporate governance concerns in his letter. 

And Vodafone Idea ended 7% higher after reports indicated that the Supreme Court will hold the next hearing in the AGR dues case on September 19. 

Stock Calls

SEBI analyst Palak Jain flagged a rounding bottom breakout above resistance in Banco Products, which showed fresh bullish momentum, supported by a strong surge in trading volumes. She suggested buying above ₹654 for target price of ₹724, with a stop loss at ₹580. Jain is bullish on the stock, driven by technical indicators, RSI signal strength and the management’s focus on product innovation and international presence.

Analyst Ashok Kumar Aggarwal of Equity Charcha is bullish on Diamond Power Infrastructure. The company recently received a letter of intent from Adani Energy for a mega supply order. Technicals also support the positive outlook, but since the stock is trading at high valuations, the analyst suggested trading with a stop loss.  He recommended buying between ₹148-₹152, with a stop loss at ₹135 and target price of ₹176.

Markets: What Next?

Globally, European markets traded mixed, while US stock futures indicate a positive start on Wall Street. 

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