Indian stock market: Indian indices – Sensex and Nifty 50 – ended the week on a higher note for third week straight on RBI’s policy announcement, which took the market by surprise.
After remaining range-bound for most of the week, benchmark indices surged sharply on Friday and settled near the week’s high, with the Nifty closing at 25,003 and the Sensex at 82,118.99.
The sectoral performance was generally favorable, with rate-sensitive sectors experiencing robust buying activity. The rally was led by realty, automobile, and banking stocks, driven by optimistic expectations for credit growth and consumer confidence.
Financials and NBFCs also saw gains, supported by the anticipation that lower interest rates will improve borrowing conditions. On the other hand, IT stocks lagged behind due to ongoing global uncertainties, especially in the U.S. and European markets.
Key market drivers for next week
Moving ahead, market participants will concentrate on important macroeconomic data for additional insights. Key high-frequency indicators like CPI inflation will be carefully observed to assess demand patterns and anticipate the central bank’s future actions.
Furthermore, the status of the monsoon and sowing activities will be tracked because of their impact on rural consumption. Globally, progress in trade talks and fluctuations in U.S. bond yields will remain significant factors shaping investor sentiment.
Technical outlook for next week
According to Ajit Mishra – SVP, Research, Religare Broking Ltd, Nifty has once again approached the upper band of its prevailing consolidation range of 24,500–25,100.
“ A decisive breakout above 25,200 would mark the beginning of a fresh uptrend, with potential to gradually move toward the 25,600–25,800 zone. On the downside, the 24,400–24,600 range is expected to act as a strong support zone during any corrective phase,” Mishra said.
Meanwhile, speaking on Bank Nifty outlook, Mishra said, “ The banking index has finally broken above the key 56,000 mark after trading in a tight range for over a month. We now expect it to move toward the 58,000 level, making this segment crucial for broader market direction. In case of a dip, the 55,350–56,000 range is likely to provide strong support.”
What should be your trading strategy for next week?
Market analysts maintain a positive outlook on the markets fueled by RBI’s rate cut.
“With the RBI’s rate cut and dovish commentary acting as strong tailwinds, we maintain our positive outlook on the markets and suggest continuing with a “buy on dips” strategy unless the Nifty decisively breaks below 24,600. However, investors should remain selective and focus on fundamentally strong stocks in sectors such as banking, auto, and real estate, which are poised to benefit from lower interest rates. Other sectors may contribute on a rotational basis,” Mishra said.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.