Indian stock market shrugs off midweek volatility, ends week on robust note

Mumbai: The Indian equity benchmarks wrapped up the session on a robust note last week, decisively breaking through critical resistance level, propelled by sustained institutional accumulation, analysts said on Saturday.

The Nifty 50 convincingly closed above the psychologically significant 25,000 mark on Friday, underscoring bullish momentum. At the closing bell, the Sensex rallied 1,046.30 points, or 1.29 per cent, to settle at a fresh high of 82,408.17, while the Nifty 50 advanced 319.15 points, or 1.29 per cent, to end at 25,112.40.

“Relentless inflows from institutional investors — both Foreign Institutional Investors (FIIs) and Domestic Institutional Investors (DIIs)—acted as key tailwinds, offsetting headwinds from prevailing geopolitical uncertainties and reinforcing positive sentiment across the street,” according to a note by Bajaj Broking Research.

Nifty Index formed a sizable bull candle with a higher high and higher low signaling resumption of up move after recent corrective consolidation. The index in the process closed firmly above the 25,000 levels signalling strength.

“Going forward, we anticipate the index to retest the upper boundary of the recent five-week consolidation zone, currently pegged near the 25,200 mark. A decisive breakout above this resistance band could open the door for an upward extension towards the 25,500 zone in the near term,” said the note.

The Indian stock market shrugged off midweek volatility triggered by escalating tensions in the Middle East and a sharp spike in crude oil prices.

The Reserve Bank of India’s relaxation of project financing norms provided a boost to financial stocks.

“The RBI’s continued dovish tone — signalling potential rate cuts on validating subdued inflation — further reinforced market confidence, positioning monetary policy as a key stabilizing force amid global uncertainty,” said Vinod Nair, Head of Research, Geojit Investments Ltd.

Crude prices surged early in the week due to geopolitical unrest, sparking concerns over inflation. However, the pace of growth in oil prices tapered significantly after the initial spike, helping to ease fears of a sustained inflationary rebound.

Investor sentiment toward the pharmaceutical sector has turned cautious following the proposed imposition of new tariffs, said analysts.

With the deadline for a 90-day pause on reciprocal tariffs approaching, markets are closely tracking trade negotiations and deal-making activity expected to unfold over the next two weeks.

“Meanwhile, geopolitical uncertainty continues to loom, as statements from world leaders regarding possible military involvement in the Middle East keep markets on edge. Investors will also keep a close eye on upcoming U.S. GDP and PCE data, along with India’s PMI figures, for cues on the strength and direction of economic recovery at home and abroad,” Nair noted.

IANS