Can Nifty sustain its momentum after scaling fresh all-time highs?

Mumbai: India's benchmark indices closed at record highs on Friday-the second trading session of the new year-tracking the upmoves in the rest of Asia. NSE's Nifty50 rose 182 points or 0.7% to close at 26,328.55. BSE's Sensex rose 573.4 points or 0.7% to end at 85,762. Both indices have notched up roughly 1.1% and 0.9%, respectively, of weekly gains-their best weekly performances in seven weeks. The equity gauges had last hit all-time highs in late November and early December, but the momentum failed to sustain as investors have been on edge in the face of a declining rupee and risk-off sentiment among foreigners. The indices have been stuck in a tight band in the past two months. "Usually, after a longer range-bound phase, the market tends to see sharp buying once momentum picks up, which was seen on Friday," said Chandan Taparia, head of technical and derivatives research at Motilal Oswal Financial Services. If the upmove sustains, the Nifty could move to the 26,500-26,700 range in the near term, he said.126315946 In 2025, the index gained nearly 10%, although it broadly traded in the range of 25,500-26,200 in the last two months of the year and struggled to cross the previous closing high of 26,215.55. Investors have been unnerved by the absence of a clear direction, though market participants in a recent ET poll predicted better days in 2026. A majority of the 31 fund managers and brokers surveyed said the Sensex and Nifty are likely to gain between 8% and 14% in 2026. More than half the poll participants said the Nifty could advance between 28,000 and 29,500 levels, while the Sensex may hit 94,000-96,000 levels in 2026. On Friday, the Volatility Index or VIX-popularly known as the market's fear gauge-rose 2.9% to 9.45 levels, suggesting traders are cautious around the record-high moves in the market. Barring the fast-moving consumer goods (FMCG) index, all sector indices ended higher on Friday. The Bank Nifty rose 0.7%, while Nifty's auto and IT indices gained 1.1% and 0.4% respectively. "The top three sectors that constitute the highest weight in the headline indices, Banks, IT, and auto, have driven Friday's gains," said Sham Chandak, head of institutional equities at Elios Financial Services. "This is on the back of higher credit offtake for banks, improving revenue outlook for IT, and higher consumption numbers seen in autos." The broader market indices outperformed the benchmarks, as Nifty Midcap 150 gained 0.9% and Nifty Small-cap 250 rose 0.8%. Out of the total 4,371 stocks traded on the BSE, 2,711 advanced and 1,524 declined. Chandak said that chemicals, IT, power, and financials will continue to do well for the next few months, and there is a high possibility of small, mid, and microcaps continuing to do better than larger peers. Foreign portfolio investors net bought shares worth ₹289.8 crore. Domestic institutions were buyers to the tune of ₹677.4 crore. Elsewhere in Asia, the tech-heavy markets led the surge with South Korea gaining 2.3% and Taiwan advancing 1.3%. China gained 0.1%, while Hong Kong rose 2.8%. Japan fell 0.4%.