Bulls walked down Dalal Street, driving benchmark indices up one percent apiece. Though the Nifty opened weaker, it easily ended above 22,000.
This week, the BSE Sensex increased 831.15 points, or 1.16 percent, to close at 72,426.64, while Nifty added 258.2 points, or 1.18 percent, to end at 22,040.70.
Sectorally, the BSE Energy index increased 3%, the BSE Oil & Gas index gained 3%, and the BSE Auto index increased 5%. However, the BSE Metal, FMCG, and Telecom indices all saw a 0.5 percent decline.
During the week, domestic institutional investors (DIIs) sold stocks worth Rs 8,731.60 crore, while foreign institutional investors (FIIs) sold stocks worth Rs 6,237.55 crore.
“Heavy buying in the banking sector helped broader indices inch towards new heights, countering the subdued beginning of the week characterised by concerns over elevated valuations and higher exchange margin requirements. The Indices continued their resilient rally, unlike other Asian peers, buoyed by weaker-than-expected inflation data from the US. Investor expectations of a rate cut from the Fed were bolstered as US retail sales data declined. Moreover, a disinflation trend in the eurozone and expectations of increased consumption demand in China after the New Year holidays provided further support,” stated Vinod Nair, Head of Research at Geojit Financial Services.
“The Indian auto sector had a strong week, lifted by anticipated high demand and a favourable earnings outlook. PSU Banks, benefiting from improved asset quality and the government’s focus on fiscal prudence, are attracting investors. Large caps gained traction, with mid and small caps seeing profit booking, driven by valuation gaps.”
“Looking ahead, a correction in PSU banks seems likely due to higher valuation risks. Meanwhile, sectors such as metals, FMCG, and capital goods are anticipated to gain momentum driven by robust construction demand, an order backlog, rural revival prospects, and India’s narrowing trade deficit. This is boosted by softer commodity prices and government-led manufacturing initiatives,” he further added.
The BSE Small-cap index had a flat finish to the day. Jubilant Industries, Force Motors, Natco Pharma, Time Technoplast, 63 Moons Technologies, Mangalore Refinery and Petrochemicals, and HPL Electric & Power experienced a 21–55 percent increase, while Permanent Magnets, Salasar Techno Engineering, Dhunseri Ventures, Andhra Petro, Kamdhenu Ventures, Orient Green Power Company, and Visaka Industries experienced a 15–23 percent decline.
