Starting the new year on a strong note, the benchmark Nifty scaled a new peak on Friday, supported by firm global cues and improved earnings expectations for the recently concluded quarter.
The Nifty surged 182 points, or 0.70%, to settle at a record closing high of 26,328.55, driven by gains in banking, metal and realty stocks. Intraday, the index touched a lifetime high of 26,340. The benchmark Sensex jumped 573.41 points, or 0.67%, to close at 85,762.01, just 74.11 points, or 0.09%, shy of its all-time closing high of 85,836.12 recorded on September 26, 2024. The index is 397.06 points, or 0.46%, below its recent intraday peak of 86,159.02 hit on December 1, 2025.
“India enters 2026 in a stronger position than most emerging markets, supported by healthy domestic earnings and improving corporate balance sheets,” said Trideep Bhattacharya, president and CIO-equities, Edelweiss Mutual Fund.
“We are beginning to see early signs of an earnings upgrade cycle, which strengthens the case for India’s outperformance versus other emerging markets in 2026,” Bhattacharya said.
From a sectoral perspective, consumer discretionary stocks appear well placed, aided by a likely income boost from the 8th Central Pay Commission, while financials should benefit as credit growth recovers from around 8-9% to 12-14% over the next year, Bhattacharya added.
Fueling the Next Upside
Aashish Somaiyaa, CEO, WhiteOak Capital AMC, however, struck a cautious note, saying, “Markets have certainly become cheaper on both absolute and relative terms, but I wouldn’t attribute much sustainability to this phase. In 2026, we may first witness a correction driven by global market dynamics, particularly in the US. Once that phase plays out, a more meaningful and durable up move could follow.”
Outperforming the benchmarks, the broader BSE Midcap and BSE Smallcap indices gained 0.97% and 0.79%, respectively. On the back of the broad-based rally, investors’ wealth rose by Rs 4.33 lakh crore to a record high of Rs 481.25 lakh crore.
Foreign portfolio investors bought shares worth Rs 289.80 crore while domestic institutional investors purchased equities worth Rs 677.38 crore, as per provisional data by the BSE.
Institutional Inflows Drive Wealth
Market breadth was positive, with 2,772 gainers against 1,449 losers on the BSE. Barring FMCG, all sectoral indices ended in the green, with banking, metal, realty and auto stocks emerging as the top performers. The BSE Bankex and the Bank Nifty also touched their respective all-time highs during the session.
Across Asian markets, equities in Hong Kong, South Korea, the Philippines, Taiwan and Indonesia were among the top gainers, rising up to 2.76%. Malaysia’s equity index slipped 0.62%, while markets in China, Japan, Vietnam and Thailand remained closed for New Year holidays.
On a weekly basis, the Sensex and the Nifty advanced 0.85% and 1.10%, respectively, extending their gains for the second consecutive week.