The Indian equity benchmarks posted notable gains this week after two weeks of consecutive losses, over investor optimism about potential US-Iran peace agreement
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MUMBAI — The Indian equity benchmarks posted notable gains this week after two weeks of consecutive losses, over investor optimism about potential US-Iran peace agreement, and decline in Brent crude prices.
Nifty added 1.10 per cent during the week and gained 1.99 per cent on the last trading day to reach 23,622. At close, Sensex was up 1,695 points or 2.30 percent at 75,527. It added 1.73 per cent during the week.
The Indian equities showed structural resilience in a turbulent week, marked by global headwinds and continued uncertainty surrounding the US Fed's policy trajectory, analysts said.
Large-cap stocks outperformed broader markets, while mid- and small-cap segments witnessed profit booking following their recent strong rally.
While US bond yields eased during the week, persistent inflationary pressures and resilient labour market data are keeping the expectations of a delayed rate-cut cycle intact, an analyst said.
"Indian equities traded in a range-bound manner with a mild negative bias, witnessing a modest recovery toward the end of the week," he added.
Meanwhile, domestic bond yields moderated, supported by RBI policy measures that improved liquidity conditions and attracted foreign inflows into the debt market.
On the sectoral front, financials emerged as the top performers, led by private banks after favourable regulatory developments and a defensive rotation away from higher-beta growth segments. FMCG stocks also advanced on expectations of sustained pricing power.
IT sector continued its decline and metal stocks were weighed down by softer commodity prices amid muted demand expectations from China.
Market participants said that a slowdown in FII selling or improved visibility on the Federal Reserve’s policy direction could serve as a trigger, for domestic capital unloading in the secondary market.
Cumulative FII selling during the week stood at approximately Rs 15,300 crore, continuing to act as a key headwind for domestic equities, although the pace of outflows moderated in the latter part of the period.
In contrast, domestic institutional investors (DIIs) remained strong buyers, recording net inflows of around Rs 24,000 crore.
Broad market indices performed in line with benchmark indices, as Nifty Midcap100 gained 0.98 per cent, while Nifty Smallcap100 edged up 0.48 per cent during the week.
Nifty 50 is expected to see the 23,800 zone as a crucial resistance area. The 23,550–23,500 region is expected to act as immediate support, market participants said.
In Bank Nifty, immediate resistance is placed around the 56,900–57,000 zone and the 56,500–56,400 zone continues to act as an immediate support zone.
Investors remain keen on key macroeconomic data points, including domestic WPI inflation, China’s industrial output, and the upcoming US Fed decision.