Indian markets closed on a weak note on Thursday’s weekly F&O expiry. The Sensex ended nearly 350 points lower at 82,259, while the Nifty managed to stay slightly above the 25,100 mark, closing at 25,111. The broader market showed relative resilience, but sentiment was weighed down by IT sector losses and a cautious stance from global investors.
Key Factors Behind Market Movement
- IT Sector Pressure: Shares of Tech Mahindra and other major IT players fell after underwhelming Q1 earnings. This contributed significantly to the day’s losses, with the Nifty IT index closing over 1% lower.
- Global Concerns: Market participants remain cautious due to ongoing uncertainty around the US Federal Reserve’s leadership and monetary policy direction. These factors are likely to impact global capital flows in the coming weeks.
- Citi Downgrade: Citigroup downgraded Indian equities from “overweight” to “neutral,” citing high valuations and limited near-term upside. It noted better relative opportunities in other Asian markets like China and South Korea.
Sectoral Highlights
- Underperformers: IT, banking, and infrastructure stocks dragged indices lower.
- Outperformers: Nifty Realty and Metals indices posted modest gains. The broader mid-cap and small-cap indices also remained resilient, indicating selective buying.
Technical View
Analysts noted that Nifty continues to find support around 25,100–25,150. However, a sustained breach below this level could lead to further downside towards 25,000 or even 24,900. Resistance in the short term is seen near the 25,300–25,350 zone.
Outlook
Market direction in the coming sessions will largely depend on upcoming earnings reports, especially from the IT sector, along with cues from global central banks. Additionally, any signals on trade or investment policy shifts may also influence sentiment.
Conclusion
Despite holding a crucial support level, Indian markets are showing signs of fatigue amid mixed earnings and global uncertainties. Investors are advised to stay cautious and maintain a selective approach in the short term.
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