**IT Rally and FII Inflows Fuel Third Day of Gains; Nifty Settles Above 24,250**

Market Snapshot

The Indian equity markets maintained their bullish momentum on Friday, July 03, 2026, with the Nifty 50 and Sensex closing in the green for the third day in a row. The Nifty 50 ended the session at 24,270.85, up 95.15 points or 0.39%, while the BSE Sensex climbed 261.79 points or 0.34% to settle at 77,763.91. The market breadth remained cautiously optimistic, though the Nifty Bank underperformed, slipping 0.16% to close at 57,938.50.

Institutional Flows: Cash Market

In a reversal of recent trends, Foreign Institutional Investors (FIIs) turned net buyers in the cash segment, while Domestic Institutional Investors (DIIs) chose to book profits after the recent rally.

• FII Net Position: Foreign investors were net buyers of equities worth ₹1,355.33 crore.
• DII Net Position: Domestic institutions recorded a net sell-off of ₹1,953.89 crore.

This shift highlights a renewed interest from global funds, likely spurred by cooling inflation expectations in the U.S., even as domestic funds capitalized on the index reaching near-term resistance levels.

Derivatives Market Activity

The derivatives segment mirrored the cautious optimism seen in the cash market. FIIs showed a mixed bag of positioning, with a focus on stock-specific long builds rather than broad index bets.

• Index Futures: FIIs added net longs worth approximately ₹472.31 crore.
• Index Options: There was significant activity in options with a net sell-off of ₹6,643.12 crore, suggesting heavy hedging or profit-taking in call options.
• Stock Futures: Strong conviction was visible in individual names, with FIIs being net buyers of ₹1,426.62 crore in stock futures.

Key Drivers and Outlook

The primary catalyst for Friday's gain was the Information Technology (IT) sector. HCL Tech led the pack with a stellar 5.79% jump, followed by Tech Mahindra and Infosys. The rally was triggered by softer-than-expected U.S. jobs data, which tempered fears of further monetary tightening by the Federal Reserve, a major positive for Indian IT firms with high U.S. exposure.

Other key factors included:

• Currency & Commodities: The Indian Rupee surged by 19 paise to settle at 95.16 against the US Dollar, providing a macro tailwind. Meanwhile, Brent crude prices hovered around $71.97 per barrel, keeping inflationary pressures in check.
• Volatility: The India VIX (Volatility Index) declined by 3.17% to 11.90, indicating a significant cooling of market anxiety.
• Sectoral Performance: Beyond IT, the Realty (+2.10%) and Pharma (+1.72%) sectors saw robust buying, while PSU Banks and Auto stocks faced selling pressure.

Looking ahead, the market focus will shift toward the upcoming Q1 FY27 earnings season. While the immediate resistance for Nifty is pegged at 24,400, sustained FII inflows could provide the necessary fuel for a breakout toward the 24,600 levels in the coming week.

TAGS: FII, DII, Stock Market, Institutional Investors, Nifty, Sensex

Tags: FII DII Stock Market Institutional Investors Nifty Sensex