Nifty, Sensex Weekly Review: Markets Fall as Crude Prices Rise, Global Risks Persist

The Indian equity benchmarks posted notable losses after two consecutive weeks of gains, over elevated crude and persistent global uncertainty. Nifty declined 0.83 per cent during the week and shed 0.12 per cent on the last trading day to reach 24,366. At close, Sensex was down 70 points, or 0.09 per cent, at 78,009. It lost 0.62 per cent during the week. Softer‑than‑expected US labour market data initially supported hopes of a patient Federal Reserve, but a rebound in crude oil prices shifted focus back to inflation risks and evolving geopolitical developments, according to analysts.

Markets remained range-bound through the week as these headwinds were largely offset by corporate earnings. Domestically, better-than-expected corporate earnings, stability in the rupee, moderation in the domestic 10-year bond yield and a gradual improvement in FII participation provided support to the domestic macro environment. Earnings breadth remained healthy, with 33 constituents of Nifty 50 outperforming estimates. Market participants felt the results underscored the strength of corporate earnings despite a challenging external backdrop and continued to create opportunities for a bottom-up stock selection approach. During the week, the large-cap sentiments largely remained capped by Middle East tensions.

However, the mid-cap index demonstrated strength and outperformed the benchmark, aided by better earnings visibility. Sectorally, consumer durables and realty were among the notable gainers, supported by improving demand trends and domestic growth optimism. PSU banks remained relatively buoyant on the back of healthy asset quality, attractive valuations and a favourable credit growth outlook.

Metals, automobiles and FMCG witnessed profit booking amid concerns over higher input costs. Broad market indices showed divergence from the benchmark indices, as Nifty Midcap100 and Nifty Smallcap100 added 0.50 per cent during the week. Investors closely track crude price trajectory, geopolitical developments, US retail sales, FOMC minutes and Chinese economic data for further cues on global growth and the Fed's policy outlook.

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