Banking and industrial stocks lead the rally while investors stay hopeful but careful

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The Indian stock market trades with a strong positive mood on Wednesday, January 28, 2026. Benchmark indices Sensex and Nifty 50 open higher and continue to hold gains during the session. Investor confidence improves after the announcement of a major India-EU trade agreement and supportive global market signals. Market capitalisation increases sharply as buying interest remains firm across banking, energy, and industrial stocks.

NSE Nifty 50 moves above the 25,300 mark in early trade, while BSE Sensex rises more than 500 points. The rally follows the previous close near 25,175.40 on January 27, 2026. Trading volume stays healthy, and volatility shows a mild increase as traders react to news and earnings updates. Overall sentiment stays optimistic but slightly cautious near resistance levels.

India-EU Trade Agreement Boosts Sentiment

The current market rise results from the India-EU Free Trade Agreement, which serves as its primary driving force. The agreement creates duty-free access for numerous products. The deal provides better long-term growth prospects for export-focused sectors that include engineering, pharmaceuticals, textiles, and chemicals.

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Investors interpret the deal as evidence that foreign investment will increase while economic relations between countries will remain stable. The new development boosts international trade confidence for India, which helps to improve stock market performance.

Global Cues and Currency Movement 

Worldwide financial markets display mixed results, which still provide supportive indications. Asian markets trade with mild gains while US markets show a steady trend. The Federal Reserve policy expectations, combined with a declining dollar value, create advantages for India and other emerging markets. These factors encourage foreign investors to look again at Indian equities.

Earnings Season and Company Results

Corporate earnings remain in focus during the session. Major companies such as Maruti Suzuki India, Larsen & Toubro, SBI Life Insurance, and Bharat Electronics release quarterly results. These announcements create active movement in individual stocks and lead to sector rotation.

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Some consumer and auto stocks face pressure due to a mixed earnings outlook. At the same time, selected banking and infrastructure stocks attract buying interest. Information technology stocks show mixed performance, with some shares rising on company-specific news while others remain flat.

IPO Activity and Broader Market Trend

A new IPO, Shadowfax Technologies, lists on the stock exchange today with a muted performance. The stock slips below its issue price in early trade. This shows that investors are still careful about new listings even when the broader market is strong.

Mid-cap and small-cap stocks perform better than large-cap stocks in today’s session. This suggests investors are moving toward growth-oriented and cyclical sectors. Market breadth remains positive with more stocks advancing than declining.
Technical Levels and Market Indicators

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The market moves in a limited range with more volatility. Futures and options expiry and important technical levels keep traders very alert. India VIX index goes slightly higher, showing little fear in the market even when prices are rising.

Domestic institutional investors give support by taking the selling pressure and keeping the market stable. Trading activity increases as short-term traders and long-term investors both remain active in the market.

Macro Environment and Outlook

Inflation trends and central bank policies stay important for the future direction of the market. Attention remains on Reserve Bank of India signals and global interest rate expectations. Liquidity conditions and budget-related hopes also influence market behaviour.

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The current Indian stock market shows a positive but balanced mood. Strong gains come from the historic trade deal, good global cues, and sector-specific buying.

Overall, the market shows confidence mixed with careful trading. Economic developments and policy decisions are likely to decide the next movement as earnings season continues and the Union Budget comes closer. The trend stays positive, but investors remain watchful for new signals and sudden changes in global markets.