Mumbai, September 28 (Sarhind Times Bureau):
Indian equities ended the week on a sour note Friday, with the Sensex tumbling 733 points and the Nifty slipping below 24,700, marking the sixth straight session of declines. The sharp sell-off was led by IT and pharma stocks, while autos also contributed to the weakness.
With the domestic bourses shut for the weekend, market participants are now fixated on Monday’s opening, where global cues from U.S. futures and GIFT Nifty indications are expected to dictate early momentum.
Analysts point to foreign institutional investor (FII) selling, global tariff uncertainties, and risk-off sentiment as the key factors pressuring large caps. At the same time, domestic institutional inflows remain resilient, offering a cushion. Volatility, however, is likely to persist as investors brace for macroeconomic prints and central bank commentary in the coming week.
A Week of Red on Dalal Street
Friday’s fall capped a volatile week marked by:
- Sensex: Down nearly 1,800 points across six sessions.
- Nifty: Dropped more than 500 points, slipping under the psychological 24,700 mark.
- Sectoral Pressure: IT and pharma bore the brunt as global recession fears dampened sentiment.
- Midcaps & Smallcaps: Witnessed profit booking after a strong run earlier this month.
Dealers cited tariff headlines, geopolitical tensions, and global risk aversion as triggers for foreign selling.
Sectoral Snapshot
- IT: Infosys, TCS, and Wipro slid as concerns about global IT spending resurfaced.
- Pharma: Dr. Reddy’s and Cipla corrected amid U.S. regulatory uncertainty.
- Autos: Maruti and Tata Motors saw selling pressure on valuation concerns.
- Banks: Stayed relatively resilient, supported by steady credit growth.
FIIs vs DIIs: The Push and Pull
- FIIs: Net sellers across the week, withdrawing funds amid global volatility.
- DIIs: Continued to buy selectively, helping stabilize indices during intraday recoveries.
Analysts note that while foreign selling is weighing on large caps, domestic flows—particularly into mutual funds—remain a long-term supportive trend.
Global Cues in Focus
Wall Street volatility, rising U.S. yields, and tariff-related headlines kept investors jittery. Asian peers also ended the week weak, compounding the negative sentiment on Dalal Street.
Traders now await clarity from:
- U.S. Federal Reserve commentary on rates and inflation.
- Global growth signals from PMI and trade data.
- Oil price trajectory, which remains a wildcard for inflation and fiscal math.
Monday’s Outlook: Key Factors
GIFT Nifty Indications
Early signals from GIFT Nifty will set the tone for Monday morning. Analysts expect a cautious open, with traders watching U.S. futures closely.
Macro Data
Domestic inflation and industrial output numbers due next week could add volatility.
Central Bank Commentary
RBI officials are scheduled to speak, and markets will parse any hints on liquidity and policy.
Earnings Watch
Analysts recommend focusing on stock-specific action as Q2 earnings season approaches.
Expert Voices
- Rohit Agarwal, Market Strategist:
“This is a corrective phase. Long-term investors should focus on companies with strong balance sheets rather than trying to time the bottom.”
- Shweta Menon, Fund Manager:
“Volatility will stay elevated, but we see opportunities in banks and domestic consumption plays.”
- Global Analyst’s View:
“Indian equities remain attractive relative to peers, but foreign investors are cautious given global uncertainty.”
Investor Sentiment
Retail traders, particularly in midcaps, have turned cautious after recent froth. Social media trading forums reflected both frustration and optimism, with some calling this a “healthy correction” and others worrying about deeper downside.
Lessons for Investors
Market veterans advise:
- Avoid panic selling in quality names.
- Stay diversified across sectors.
- Keep some liquidity ready for opportunities.
- Expect volatility around global events.
Conclusion
The extended slide in Sensex and Nifty highlights the fragility of sentiment in uncertain global conditions, even as India’s domestic growth story remains intact. All eyes are now on Monday’s open, where cues from GIFT Nifty and U.S. futures will guide the first moves.
For investors, the coming week will test both nerves and conviction.
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