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Sensex jumps 1,109 points as IT stocks surge and Sitharaman opens door on LTCG
HCLTech's results set off the IT sector's best day in 17 months, and the Finance Minister's remarks on capital gains tax lifted the market in the final hour. The rupee firmed to 95.28.
Key points
- The Sensex rose 1,109.10 points (1.54%) to 73,033.78 and the Nifty gained 358.60 points to 22,721.95.
- The Nifty IT index jumped 5.22%, its biggest one-day gain since May 2025, led by an 8.42% rise in HCLTech.
- The rupee settled at 95.28 per dollar, up 50 paise from Monday's close.
Indian shares had their best day in four months on Tuesday. A rush back into technology stocks after HCLTech’s results, and remarks from Finance Minister Nirmala Sitharaman on capital gains tax late in the session, pulled the market out of a week-long slide.
The BSE Sensex closed 1,109.10 points, or 1.54%, higher at 73,033.78. The NSE Nifty 50 rose 358.60 points, or 1.60%, to 22,721.95. Both indices posted their biggest single-day gains since 12 June, and 46 of the 50 Nifty stocks ended higher. Indian equities were the best performers in Asia for the day.
IT leads the way
The Nifty IT index jumped 5.22% to 29,830.10, its biggest one-day rise since 12 May 2025, with all ten of its stocks in the green. HCLTech, which on Monday evening reported a 21% rise in quarterly profit and raised the lower end of its revenue guidance, climbed 8.42%. Tata Consultancy Services, Tech Mahindra and Shriram Finance were among the other leading gainers on the Nifty.
“HCLTech results were in line (with our expectations),” said Somil Mehta, head of retail research at Mirae Asset Sharekhan. “The IT pack has been oversold, and it has been holding on to good levels.”
Realty and consumer durables stocks also gained, and the Nifty Bank index rose 1.03%. Pharma was the only major sector to end lower, and only just. The Nifty Midcap 100 added 1.06% while the Smallcap 100 barely moved. Kotak Mahindra Bank, Eternal, Maruti Suzuki and Max Healthcare were among the few Nifty stocks to fall.
The Finance Minister’s remarks
The rally gathered pace in the last hour of trading after Sitharaman said the government was willing to hear the views of market participants on long-term capital gains (LTCG) tax and the securities transaction tax (STT). She described the debate over the two taxes as healthy. No formal proposal has been announced, but traders read the comments as a sign that the tax regime could be reconsidered.
“Equities are likely to extend their recovery in the near term,” said Siddhartha Khemka, head of research for wealth management at Motilal Oswal Financial Services.
Sudeep Shah, head of technical and derivatives research at SBI Securities, said “22,830-22,850 will act as an immediate hurdle” for the Nifty, with support around 22,550 to 22,580.
Rupee firms, oil eases
The rupee settled at 95.28 per dollar, 50 paise stronger than Monday’s close of 95.78, extending its recovery after the Reserve Bank’s steps to curb speculative bets on the currency. Speaking on a panel at the Bloomberg New Economy Forum on Tuesday, Kotak Mahindra Bank founder Uday Kotak said: “My personal view is we should let the rupee find its own level.”
Brent crude eased from the previous session’s jump but stayed high, at about $104.42 a barrel in the afternoon, after the attacks on Saudi Arabia kept supply worries alive.
Tuesday’s gain still leaves the Nifty down 2.89% for the month and 6.15% over three months. Selling in South Korea, where the Kospi fell 5.46% as memory-chip makers SK Hynix and Samsung Electronics slumped, showed how fragile sentiment in the region remains. Wholesale inflation data for September is due at noon on Wednesday.