Benchmark Sensex ended the week 1.6% higher, while the smallcap index surged nearly 6%. The market rebound was primarily driven by positive news on the domestic macro front, where the GDP growth was quicker than the previous quarter.
A fall in the dollar index also sweetened investor sentiment towards emerging markets, while the US equity markets declined due to uncertainty over Trump’s economic policies.
On the tariffs front, the long-awaited tariffs were enacted, but later backtracked by delaying their implementation, creating uncertainty among investors.
In the smallcap pack, Anupam Rasayan, Sandur Manganese, Man Industries (India), Vadilal Industries, Triveni Turbine, and Coffee Day Enterprises led the gains, rising up to 40% in a week.
The biggest losers, on the other hand, were Gensol Engineering, EKI Energy Services, Jindal Worldwide and Suratwwala Business Group. The shares of Gensol cracked nearly 40% on the back of rating downgrades by key agencies, owing to a high credit risk and financial troubles.Like smallcaps, the story is similar in the midcaps as none of the stocks saw notable declines. About 7 counters including Biocon, Suzlon Energy, GSK and ZEE gained up to 13% in the week.Coming to the largecaps, 22 out of 30 stocks in the benchmark Sensex ended the week on a positive note. M&M, NTPC, SBI, Adani Ports and Tata Steel were the biggest gainers in this space.
Will the momentum continue?
Analysts say the domestic market gradually recovered from its oversold levels. However, a decisive upward momentum will be based on the recovery in corporate earnings and an ease in tariffs uncertainty.
Going forward, investors will also keep a close eye on payroll data and US inflation to get cues on interest rates.
“The premium valuation of broader indices may restrict a broad-based market recovery in the short run, while large caps appear attractive,” said Vinod Nair, Head of Research at Geojit Financial Services.
“We expect the market to trade within a broad range, albeit some volatility on account of fickleness in global developments,” said Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal.
Technically, analysts said the sentiment remains positive, with the potential to reach higher levels in the short term. “On the higher end, immediate resistance is seen at 22,700–22,750. On the lower end, support is placed at 22,400, below which the index may lose momentum,” said Rupak De, Senior Technical Analyst at LKP Securities.
Data: Ritesh Presswala
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
