Indian benchmarks opened the first trading session of 2026 on a steady footing as domestic and global cues remained broadly supportive, while the fast-moving consumer goods (FMCG) pack bore the brunt of profit-taking following a policy change.
India market update
At 1pm, the BSE Sensex traded 38.55 points higher at 85,259.15 after touching an intraday peak of 85,451.70. The Nifty 50 was up 20.80 points at 26,150.40, having hit a high of 26,197.55. Midcap indexes posted modest gains while the smallcap segment slipped, signalling a selective market rather than a broad-based advance.
Sector action was mixed. Information technology, auto, real estate and metal counters offered support to the indices, trading with modest gains. The FMCG index was the notable underperformer, falling roughly 3% as key names such as ITC and Godfrey Phillips came under intense selling pressure.
The selling in FMCG followed the government’s announcement of an excise duty on cigarettes, effective 1 February 2026, which weighed on cigarette manufacturers and related consumer stocks. Godfrey Phillips registered particularly sharp losses across segments, exacerbating the sectoral drag.
On the Nifty 50, stocks that led the upside included Eternal, NTPC, Infosys, Wipro and Tech Mahindra. On the downside, ITC, Dr Reddy’s Laboratories, Bajaj Finance and Bharat Electronics were among the heaviest drags on the index.
Market breadth on the National Stock Exchange reflected a broadly balanced session. Of 3,062 stocks traded, 1,495 advanced while 1,474 declined and 93 were unchanged. Selective strength was evident as 55 stocks made fresh 52-week highs, while 39 slipped to new 52-week lows. A total of 63 counters were locked in the upper circuit at some point, while 42 hit the lower circuit.
In the midcap terrain, Vodafone Idea, Adani Total Gas, Supreme Industries, Ashok Leyland and APL Apollo Tubes delivered gains in the 2-6% range, drawing buyer interest. By contrast, Godfrey Phillips plunged about 17%, and names such as Dixon Technologies, Bharti Hexacom, Page Industries and Motilal OFS eased 1-2%.
Smallcap performance was mixed as well. PNB Housing, Karur Vysya Bank, Cholamandalam Holdings and Star Health advanced between 2% and 5%, while Deepak Fertilisers, Devyani International, Aster DM and Welspun Corp declined 2-4%.
Traders noted that while headline indices remained supported, the session highlighted pockets of sector-specific volatility, particularly in consumer staples where regulatory and tax developments can produce sharp moves. Investors appeared willing to buy selective quality names in infrastructure, energy and information technology, while rotating out of areas where near-term policy changes pose earnings risks.
With the market stepping into a new calendar year, participants will be watching corporate earnings, macro data and policy moves closely for cues. For now, the prevailing tone is one of cautious optimism: indices held their ground but underlying activity showed a clear split between winners and losers.
Key Takeaways:
- India market update: Sensex and Nifty opened 2026 on a positive note with modest gains despite pressure on FMCG stocks.
- FMCG index fell about 3% after ITC and Godfrey Phillips reacted to a new excise duty on cigarettes effective 1 Feb 2026.
- Market breadth was balanced with selective buying; 55 stocks hit 52-week highs while 39 hit new lows.
- Midcap and smallcap segments showed mixed performance with notable rallies in Vodafone Idea and Adani Total Gas and a sharp drop in Godfrey Phillips.
