Nifty and Sensex post weekly gains as crude oil prices decline

Indian equity benchmarks extended gains for a third straight week, supported by lower crude oil prices, easing geopolitical tensions and optimism over an India-US trade deal. Analysts expect corporate earnings and key domestic and global economic data to guide market direction

Mumbai: The Indian equity benchmarks posted a third consecutive week of gains, aided by a sharp correction in crude oil prices to pre-Iran war levels and improved traffic through the Strait of Hormuz.

Nifty added 0.18 per cent during the week and edged up 0.14 per cent on the last trading day to reach 24,056. At the close, the Sensex was up 109 points, or 0.14 per cent, at 77,100. It added 0.39 per cent during the week.

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The domestic markets navigated a week of mixed signals with notable resilience, even as broader indices, especially mid-caps, faced modest selling pressure.

Easing geopolitical risks amid progressing US-Iran talks and optimism around an India-US trade deal helped fuel domestic investor sentiment.

However, expectations of rising inflationary pressure and a potential weakening in rural demand began to surface, driven by concerns over uneven monsoon distribution, an analyst said.

Sustained softness in crude prices remains a clear macro positive in the near term, with improving inflation, fiscal and current account dynamics collectively providing the RBI with greater policy flexibility.

On the sectoral front, pharma and healthcare stocks outperformed, while private banks advanced following the RBI’s clarity on the FCNR(B) deposit swap scheme.

Metals were the major losers due to falling commodity prices, while consumer durables lagged amid demand concerns.

Broad market indices showed divergence from the benchmark indices, as the Nifty Midcap100 lost 1.15 per cent, while the Nifty Smallcap100 edged up just 0.03 per cent during the week.

Immediate resistance levels for the Nifty are placed at 24,400 and 24,500, while support is seen at 23,900 and 23,800.

Immediate support for the Bank Nifty is placed in the 57,500-57,400 zone, while resistance is seen at 58,900 and 59,000.

As corporate earnings reports are expected in the coming weeks, management commentary on demand visibility, margins and order flows will serve as key indicators for market direction.

“A prudent yet optimistic stance is warranted, with a focus on selectively building positions in fundamentally strong companies that have seen recent corrections without any meaningful deterioration in their underlying outlook,” a market participant said.

Investors remain keenly focused on US PCE data, which will shape global market sentiment, along with non-farm payrolls and unemployment figures, which will influence Fed rate expectations and overall risk appetite.

Domestically, industrial production data and June PMI readings will provide early signals ahead of the Q1 earnings season, according to analysts.