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Benchmark indices snapped a three-day losing streak and kicked off September on a strong note, buoyed by upbeat Q1 GDP data. The Nifty opened higher and extended gains throughout the session, closing up 198 points, or 0.81%. Broader markets also saw robust buying, with both the small-cap and mid-cap indices climbing over 1.5%. Sector-wise, the Nifty Auto index led the rally with a sharp 2.8% gain, followed by consumer durables, which rose 2.1%. Other sectors such as IT, metals, energy, and oil & gas advanced between 1.3% and 1.6%. Banks and financials posted modest gains. On the downside, FMCG ended flat, while pharma and media slipped slightly. Market volatility eased, with India VIX falling nearly 4%.

Nifty Outlook

The index snapped its three sessions decline as it formed a bullish candlestick pattern with a higher high and higher low signaling an initial sign of pause in the corrective decline. Going ahead index holding above last week low of 24,400 will lead to consolidation in the range of 24,400-24,900. Support is placed at 24,400-24,337 levels being the confluence of the recent lows and the key retracement area. A breach below the same will signal acceleration of decline towards the key support area of 24,000-23,800 levels being the confluence of the 52 weeks EMA and the previous major lows and the previous major breakout area.

Bank Nifty Outlook

Bank Nifty formed a bull candle which remained contained inside previous session price range signaling consolidation around the 200 days EMA. Going ahead, index holding above the 200 days EMA placed around 23,500 will lead to consolidation in the range of 53,500-55,000 in the coming sessions. Bank Nifty has immediate support at 53,200-53,500 being the confluence of the 200 days EMA and the low of May 2025. A breach below the same will signal acceleration of decline towards the key support area of 52,500-52,000 levels. 

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