Sensex and Nifty Kickstart September on a High: IT and Auto Stocks Lead the Rally

The Indian stock market began the month of September on a strong note, reflecting renewed investor optimism following the release of first-quarter GDP data. The country’s economy grew 7.8 percent in Q1, exceeding forecasts and setting a positive tone across sectors.

Investors were in a buying mood, pushing key indices higher. Both Sensex and Nifty witnessed notable gains, fueled primarily by robust performances in IT and auto stocks.

Market Performance Overview

The market sentiment on the first day of September was upbeat, with major indices closing significantly higher:

• Sensex closed at 80,364.49, up 554.84 points (0.70%)
• Nifty closed at 24,625.05, up 198.20 points (0.81%)

Market breadth supported this rally:

• 2,681 shares advanced
• 1,320 shares declined
• 173 shares remained unchanged

Broader market indices reflected similar optimism:

• The Nifty Midcap and Smallcap indices gained more than 1 percent each, showing that investor interest extended well beyond just the large-cap stocks.
• India VIX, a measure of near-term market volatility, eased nearly 4 percent, pointing to increased stability

Auto Stocks Drive the Rally

Auto stocks dominated the session, backed by strong sales performance in August. The Nifty Auto index saw all 15 constituents in the green, with several key names standing out:

• Bajaj Auto: Sales up 5% YoY
• M&M: Sales largely stable
• Royal Enfield: Impressive growth with 55% YoY jump, surpassing expectations

The positive momentum in auto stocks highlighted strong domestic demand and investor confidence in the sector.

IT Stocks Join the Uptrend

IT stocks also contributed to the positive sentiment, with all 10 constituents of the Nifty IT index trading higher. Companies in the sector benefited from steady global demand and domestic stability.

• Mphasis emerged as a notable performer, leading gains in the IT pack
• The sector’s broad-based rise reflects solid fundamentals across companies

Historical Context and Market Triggers

Historically, September tends to be a muted month for equities, with Nifty declining in six of the last 10 years. However, current market conditions present a contrasting scenario:

• Strong Q1 GDP growth has energized investor sentiment
• Talks on GST rationalisation, potentially leading to a two-tier tax structure, are underway
• Global cues, including expectations around the US Federal Reserve’s rate decision, could further influence market direction

This combination of domestic growth and global factors sets the stage for a promising start to the month.

Company Highlights: Key Movers

Auto Sector Leaders:

• Bajaj Auto – Sales up 5% YoY
• M&M – Stable sales
• Royal Enfield – Soars 55% YoY

IT Sector Movers:

• Mphasis – Top performer in the IT pack
• Other IT firms – Broad-based gains across all 10 Nifty IT constituents

These leaders not only drove the rally but also highlighted sectors where domestic and global demand are contributing to tangible growth.

Summary of the Day

The Indian stock market opened September with confidence, backed by strong economic data and sectoral momentum. Both Sensex and Nifty climbed to new levels for the day, supported by:

• Robust Q1 GDP growth of 7.8%
• Broad-based gains in auto and IT stocks
• Positive participation in midcap and smallcap indices
• Lower market volatility, as indicated by India VIX

As markets continue to absorb domestic and global triggers, investors are likely to watch auto and IT sectors closely, alongside policy developments and economic data releases.

The day’s trading reinforced a key takeaway: despite historical trends of muted September performance, strong fundamentals and sectoral rallies can set the tone for sustained market optimism.