- IT heavyweights sparked a bounce that may signal the start of a new upward leg.
- Bank Nifty reclaimed short‑term momentum, hinting at a deeper credit‑cycle recovery.
- Three sub‑₹100 stocks—Yes Bank, Sagility, HFCL—show risk‑adjusted upside above 10%.
- Domestic institutional inflows offset modest FII outflows, providing a cushion against global shocks.
- The Nifty 50 is trapped in a 25,500‑25,900 range; a break could trigger a 5% move.
You missed the early IT rally, but the window to profit is reopening now.
Why the Indian Stock Market’s Recovery Beats Global Headwinds
The broad‑based bounce began after a multi‑session decline, led by an earnings‑driven surge in the IT sector. Companies such as Infosys and TCS reported better‑than‑expected quarterly numbers, which diluted concerns about potential U.S. secondary duties on Russian and Iranian trade. While tariff talk still looms, the impact has been largely contained because the Indian export basket is diversifying away from the most vulnerable markets. At the same time, domestic institutional investors (DIIs) have continued to pour fresh capital, offsetting a modest outflow from foreign institutional investors (FIIs). This net inflow acts as a stabilising force, allowing the market to respect higher‑timeframe support levels on the Nifty and Bank Nifty charts.
How the Nifty 50’s 25,500‑25,900 Range Shapes Your Trade Play
Technical analysis shows the Nifty 50 hovering below its 20‑, 50‑ and 100‑day exponential moving averages (EMAs), indicating weak short‑term momentum. The 200‑day EMA sits around 25,940, acting as a ceiling that sellers are defending. Immediate resistance clusters at 25,800‑25,850, with a stronger supply zone near 25,900. On the downside, the 25,500‑25,550 band is the next support; a decisive break below 25,500 could invite a deeper correction toward the 24,800 level, which historically marks a 10‑month low. For traders, a clean close above 25,900 with volume would validate a bullish breakout, potentially unlocking a 5% rally toward the 27,000 psychological barrier.
Bank Nifty’s Momentum Flip: What It Means for Lenders
Unlike the broader index, Bank Nifty has formed a short‑term higher‑low pattern and reclaimed both the 20‑ and 50‑day EMAs, suggesting a resurgence of buying pressure in financials. The index’s recent recovery from a swing low near 59,000 demonstrates that institutional buyers are defending this zone, likely in anticipation of a credit‑cycle tailwind from improving corporate earnings and stable loan‑growth metrics. Immediate resistance lies around 60,300‑60,400, where selling pressure could re‑emerge if the breakout lacks conviction. Support sits at 59,700‑59,800, with a critical breakdown level at 59,600‑59,500. A sustained close above 60,400 could pave the way for a test of the 61,500 level, a historic high from early 2023.
Under‑₹100 Gems: Yes Bank, Sagility, and HFCL – Deep Dive
Analyst Sumeet Bagadia highlighted three sub‑₹100 equities with attractive risk‑reward profiles. Yes Bank trades at ₹23.46 with a target of ₹25, offering a 7% upside and a tight stop loss at ₹22.68. The bank’s recent capital infusion and improving asset‑quality ratios make the price action less speculative. Sagility, a technology‑enabled services firm, is priced at ₹53.41 with a target of ₹60, implying a 12% upside. Its order‑book expansion in the telecom and renewable‑energy segments aligns with the broader IT growth narrative. HFCL (HFCL Limited) sits at ₹68.02 with a target of ₹76.10, delivering an 11% upside. The company benefits from government‑backed telecom infrastructure projects and a recent uptick in order flow for fiber‑optic networks. All three stocks sit below their 50‑day EMA, indicating room for a technical bounce, while fundamentals remain supportive of medium‑term gains.
Sector Outlook: IT and Banking Trends in 2024
The IT sector is entering a “digital‑spending” phase, driven by higher adoption of cloud, AI, and cybersecurity services. Global demand for Indian‑based software remains resilient despite macro‑uncertainty, and the sector’s earnings‑per‑share (EPS) growth is projected at 12‑15% YoY for FY24. On the banking side, the RBI’s incremental policy easing and a modest dip in non‑performing assets (NPAs) create a favorable environment for credit‑growth. Peer banks such as HDFC Bank and Axis Bank have reported double‑digit profit expansion, setting a benchmark that smaller lenders like Yes Bank can emulate once capital buffers are fully restored. Historically, after a multi‑session correction, both IT and banking have led the next rally in India, as seen in the 2017‑2018 cycle when IT stocks outperformed by 30% over six months.
Investor Playbook: Bull and Bear Cases
Bull case: A clean break above the Nifty 25,900 resistance, coupled with a sustained Bank Nifty close above 60,400, could trigger a 5‑6% index rally. In that scenario, the three sub‑₹100 picks could each deliver 10‑15% upside, rewarding investors who enter on pull‑backs near their stop‑loss levels.
Bear case: If the Nifty falls below 25,500 and Bank Nifty drops under 59,500, the market may revisit the 24,800‑25,000 zone, eroding short‑term gains. In a bearish environment, the recommended stocks would likely see their targets miss, and stop‑losses could be hit, emphasizing the need for tight risk management.
Regardless of the scenario, maintaining a disciplined position size and watching the EMA clusters will help you navigate the volatility that typically follows a range‑bound market.