Nifty, Sensex post notable gains this week over hopes of US-Iran peace pact
Mumbai, June 13
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.
— IANS
Reader Comments
US-Iran peace hopes are good for crude prices, but the Fed policy uncertainty still hangs over us. Rate cuts might be delayed, so don't get too excited. I'm holding my investments and waiting for clearer signals.
Financials performing well is a positive sign. Private banks seem to be getting their act together. But IT sector falling is concerning—hope it's just a temporary correction. Nifty at 23,800 resistance will be key next week. Fingers crossed! 🤞
Interesting week. The resilience of Indian equities despite global headwinds is impressive. FII selling is a headwind, but DII inflows are stabilizing. Let's see if the US Fed decision later this month provides any clarity.
Waah! Finally some positive movement. But honestly, mid and small caps taking a hit after the rally was expected. Profit booking is natural. I'm more worried about FIIs continuing to sell—that's the elephant in the room. Domestic investors need to stay strong.
Good to see gains, but I'm cautious. The Fed decision and domestic WPI data next week will set the tone. If inflation remains sticky, rate cuts will be delayed further. I'm not adding positions yet—better to wait and watch.
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