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* Equity benchmarks Nifty and Sensex continued their rally for the third consecutive day, with the Sensex nearing the 81,000 level and Nifty approaching the 24,500 mark, supported by buying interest in banking, defense, and real estate stocks. Broad-based buying was seen across the market, with both the mid-cap and small-cap indices gaining 1% each. As a result, the advance-decline ratio for Nifty 500 stocks stood at 1:5:1. Small-cap PSU banking stocks saw a strong rally, driven by expectations that the RBI might cut the CRR and upbeat comments from the Finance Minister, praising the performance of PSU banks in recent years. Realty stocks also posted significant gains after reports indicated that housing sales are set to hit a record, with projections of over 300,000 homes sold in India's top seven cities, valued at Rs.5.1 trillion, according to Jones Lang LaSalle. This surge was fueled by strong demand in major cities and solid Q2 earnings.

* Foreign institutional investors (FIIs) were net buyers of over Rs.3,500 crore yesterday, and the record high close in US markets, along with hopes of a US Fed interest rate cut this month, further boosted market sentiment. Global shares traded mixed, with markets reacting to political turmoil in South Korea, while European markets opened at record highs ahead of a statement from the US Fed Chairman.

* PSU banking stocks had a standout performance, with the PSU Bank Index gaining over 2%. Small-cap PSU banks were the biggest gainers of the day, with stocks like IOB, Union Bank, Central Bank of India, Indian Bank, and Bank of Baroda surging between 4-11%.

Technical Outlook:

* Nifty Index opened positive and crossed a major hurdle of 24500 marks but witnessed a sharp fall within seconds during mid-day. The good part is that it respected support of 24350 zones and witnessed a quick recovery from the intraday fall to later close with marginal gains. It formed a Doji sort of a candle with longer lower shadow indicating buying interest is intact at lows and has been making higher lows from the last four sessions. Now it has to hold above 24400 zones for an up move towards 24650 then 24750 zones whereas supports can be seen at 24350 and 24250 zones.

Derivative Outlook:

* Nifty future closed positive with gains of 0.07% at 24563 levels. Positive setup seen in Lodha, Oberoi Realty, Indian Bank, Paytm, Policybazar, Bank of India, Apollo Tyres, Canara Bank, CDSL, Prestige Estate, Federal Bank and MCX while weakness in Adani Green, Adani Total gas, ACC, Nykaa, Bajaj Auto, Escorts, Marico, Tata Motors, MGL, Britannia, Hero Motocorp, Maruti and ICICI Prudential Life insurance.

* On option front, Maximum Call OI is at 25000 then 24800 strike while Maximum Put OI is at 24000 then 24200 strike. Call writing is seen at 24600 then 24750 strike while Put writing is seen at 24500 then 24400 strike. Option data suggests a broader trading range in between 24000 to 25000 zones while an immediate range between 24200 to 24700 levels.

* FM Nirmala Sitharaman’s upbeat remarks, stating that PSU banks have performed exceptionally well in recent years. In addition, the Minister of State for Finance, Pankaj Chaudhary replied in Rajyasabha that the Government is not considering any further mergers of PSU lenders

* Adani’s Ambuja in Talks to acquire Star Cement- Adani Group’s unit Ambuja Cement is in talks to acquire Star Cement as part of its expansion strategy, MoneyControl reported

* Cyient DLM - Company has signed an MoU with Arcedo Systems to establish a 500 kilowatt per hour solar power plant at its Mysore facility.

* Bharti Airtel - Company has awarded a multi-year, multi-billion 4G and 5G extension deal to Ericsson for its operations in India

* Adani Energy Preferred Bidder For Rs 25,000-Crore Project - Company has reportedly emerged as the preferred bidder for a high-value transmission project under Rajasthan Part-I Power Transmission. The project, valued at approximately Rs 25,000 crore, is poised to become AESL's largest order win to date, once the formal award process concludes.

* Suzlon Energy - Company has expanded its partnership with Jindal Renewables for an additional 302.4 MW wind project, which aims to accelerate India’s green steel production

* Aurobindo Pharma - Company has clarified that the company and its subsidiaries are not connected with the ownership or operations of Kakinada Seaports and Kakinada SEZ. This clarification follows a report regarding complaints filed on the ownership held by Auro Infra in Kakinada Seaports and Kakinada SEZ.

* Nazara Tech - Company signed a letter of intent with Lysto to introduce blockchain applications,

Global Market Update

* European Market - European stocks and US equity futures made modest gains as traders braced for political developments in France and awaited remarks from Federal Reserve Chair Jerome Powell. Both France and Germany Index gained 0.4% and 0.8% respectively.

* Asian Market - Asian stocks fell, poised to snap a three-day advance, led by declines in South Korea as a brief imposition of martial law overnight spurred risk-off sentiment. South Korea Index slipped 2.3% while Japan Index ended marginally green

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