The Indian stock market recorded sharp gains on Friday, with the Sensex and Nifty rising more than 1% to end the week on a positive note. Strong Q1 earnings, sharp buying in IT stocks and other factors boosted investor sentiment despite a global market sell-off.

The Sensex surged over 964 points to close at 78,151, while the Nifty 50 gained around 262 points to end the session at 24,334. The rally came despite weakness in the broader market, with the Nifty Midcap 100 and Nifty Smallcap 100 indices declining by up to 0.4%.

Here's how analysts read the market pulse:

There is a shift in market momentum, with strong traction moving towards large-cap stocks, led by the IT and banking sectors, said Vinod Nair, Head of Research at Geojit Investments. He added that the trend is being supported by optimism around business updates and Q1 earnings expectations.

"The trend appears to be driven largely by domestic institutional investors rotating out of expensive mid- and small-cap stocks and into more attractively valued large caps that offer a better risk-reward profile. At the same time, buying interest is emerging in consumer durables on expectations of healthy domestic demand in H2FY27. The broader market remains constructive, with a combination of selective profit booking and buying, as the overall outlook for India continues to improve," he said.

The sell-off for winners of the artificial-intelligence boom deepened Friday and yanked stock markets lower worldwide. Oil prices, meanwhile, continued to jump because of the war with Iran.

The S&P 500 fell 1% to finish its first losing week in the last three and only its third since the end of March. Just a couple days earlier, it had climbed within 0.5% of its all-time high.

The Dow Jones Industrial Average dropped 406 points, or 0.8%, and the Nasdaq composite sank 1.4%.

A global rout in tech stocks dragged Europe's equity benchmark slightly lower on Friday, leaving investors on edge as they prepare for next week's European Central Bank meeting and corporate earnings.

The pan-European STOXX 600 index fell 0.34% to 641.53 points. It was largely unchanged for the week.

"The index has broken out of a five-day consolidation phase, indicating improving optimism among traders and investors. The overall trend remains positive as the index continues to trade above its critical moving averages. Additionally, the RSI has entered a bullish crossover, reinforcing the positive momentum. In the near term, the index is likely to remain strong, with the potential to advance towards the 24,800 level. On the downside, immediate support is placed at 24,200. A decisive fall below this level could trigger a phase of consolidation," said Rupak De, Senior Technical Analyst at LKP Securities.

Most active stocks by turnover

Kalyan Jewellers (Rs 3,037 crore), RIL (Rs 2,418 crore), Jio Financial Services (Rs 2,357 crore), BHEL (Rs 2,099 crore), Tech Mahindra (Rs 1,652 crore), ICICI Bank (Rs 1,598 crore) and Federal Bank (Rs 1,507 crore) were among the most active stocks on the NSE in value terms. Higher trading activity by value can help identify the stocks with the highest turnover during the day.

Most active stocks by volume

Vodafone Idea (27.54 crore shares traded), Suzlon Energy (11.14 crore), Jio Financial Services (9.6 crore), Yes Bank (7.55 crore), Kalyan Jewellers (5.39 crore), Groww (4.98 crore) and MRPL (4.97 crore) were among the most actively traded stocks by volume on the NSE.

eClerx Services, Authum Investment, Federal Bank, Kalyan Jewellers, Afcons Infrastructure, Tech Mahindra and Bharat Forge were among the stocks that witnessed strong buying interest from market participants.

Stocks that hit their 52-week highs on the NSE included Federal Bank, Exide Industries, Sona BLW Precision, Himadri Speciality, Adani Transmission, Ipca Laboratories and Gujarat Fluorochemicals.

CEAT, Welspun Corp, Kirloskar Oil, Emmvee Photovoltaic, Vijaya Diagnostic, HFCL and Gallantt Metal were among the stocks that witnessed significant selling pressure.

Among the stocks that hit their 52-week lows on the NSE were Vedanta and Go Digit General Insurance.

Out of the 3,419 stocks traded on the NSE on Friday, July 17, 1,312 advanced, 2,004 declined, while 103 remained unchanged.