Nifty, Sensex post strong weekly gains over sustained crude price correction
Mumbai, July 4
The Indian equity benchmarks posted a fourth consecutive week of gains, over sustained correction in crude oil prices and expectations of a more favourable global interest rate environment.
Nifty added 0.89 per cent during the week and edged up 0.39 per cent on the last trading day to reach 24,270. At close, Sensex was up 261 points, or 0.34 per cent, at 77,763. It added 0.86 per cent during the week.
The domestic markets shifted from defensive caution at the start of the week to growing optimism by the close. The early week was marked by profit-booking due to scepticism over the durability of the US-Iran peace arrangement, muted expectations ahead of the upcoming earnings season, and a patchy start to the monsoon.
"Easing tensions around the Strait of Hormuz weighed on crude oil prices, while dovish commentary from the Fed Chair, coupled with softer US labour market data, reinforced expectations of a more accommodative global interest-rate environment," analysts said.
Further, domestic sentiment received an additional boost from optimism surrounding the India-Japan summit, with investors anticipating progress across trade, defence, semiconductors, AI collaboration, and a proposed rupee-yen settlement framework.
On the sectoral front, real estate, pharma, and healthcare stocks outperformed, whereas PSU banks and energy counters lagged. The IT sector staged a notable rebound, due to short covering, and a strengthening investment narrative around Indian IT firms' role in enterprise AI adoption.
Broad market indices performed almost in line with benchmark indices, as Nifty Midcap100 added 0.64 per cent, while Nifty Smallcap100 rallied 2.05 per cent during the week.
According to analysts, immediate resistance levels for Nifty are placed at the 24,400 level and the 24,200 level is expected to provide immediate support, followed by the 24,000 level.
Immediate support for Bank Nifty is placed in the 57,600-57,500 zone, while resistance is seen at 58,200-58,300 zone.
Investors remain keen on US FOMC minutes, domestic earnings season, monsoon progress, credit growth trends, and ongoing trade negotiations with Japan, the UK, and the US.
"While risks persist amid downward revisions to earnings growth estimates, monsoon-related inflation concerns, and continued FII caution, much of the visible uncertainty appears to be priced in, leaving room for a constructive read on incremental positives," a market participant said.
— IANS
Reader Comments
Good to see IT sector rebounding with AI adoption narrative. Indian IT firms have real potential there. But I'm cautious about PSU banks lagging — need to watch credit growth and NPAs closely. Also, monsoon progress is critical for rural demand.
The India-Japan summit optimism is interesting — rupee-yen settlement framework could reduce dollar dependency. But let's not get too carried away. FIIs are still cautious, and earnings downgrades are a real concern. Hope the monsoon picks up pace.
Smallcap100 rallying 2% is impressive! But I remember last year's smallcap frenzy — need to be selective. Real estate and pharma doing well is a sign of domestic strength. Let's see if Bank Nifty can break 58,300 next week. 🤞
While I appreciate the positive sentiment, I'm a bit sceptical. The article itself mentions earnings downgrades, FII caution, and monsoon inflation risks. Markets seem to be pricing in too much optimism too quickly. I'd rather stay defensive till earnings season confirms the trend.
Fourth consecutive weekly gain — the bull market is refusing to die! 😄 But seriously, crude correction is a game changer for India. Lower input costs for companies, lower fuel inflation for consumers. Let's hope the government also passes on benefits through excise cuts.
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