The Indian stock market faced significant challenges this week as modest GDP and corporate earnings estimates dampened investor sentiment. This led to widespread selling pressure, affecting broader market indices.
Market Highlights
Only four small-cap stocks delivered double-digit returns during the week. Spandana Sphoorty Financial topped the list with a 9% gain, followed by PTC Industries, Coffee Day Enterprises, Vijaya Diagnostic, and Pokarna, which also posted notable gains.
In stark contrast, 176 small-cap stocks witnessed double-digit declines. Notable losers included Jai Corp, KEC International, Inox Wind, Skipper, and Oriental Rail Infrastructure.
The midcap segment fared no better, with no stock delivering double-digit weekly returns. The top performers in this category were The Phoenix Mills (5.5%), UPL (3.5%), and Uno Minda (3.2%). However, 18 midcap stocks suffered double-digit losses, with Kalyan Jewellers dropping by as much as 20%.
Among Sensex constituents, Tata Consumer led the gains with a 4% return, followed by HCL Tech (2.5%) and HUL (1.5%). Only 8 of the 30 Sensex stocks ended in the green, while the remaining 22 recorded losses.
Foreign Investor Activity
Foreign institutional investors sold nearly $2 billion worth of equities during the week, further pressuring the market. A strengthening dollar and rising US bond yields contributed to the negative sentiment.
Looking Ahead
Investors will closely monitor corporate earnings next week, with major companies, particularly in the IT sector, releasing their Q3 results. Key macroeconomic indicators, such as India’s inflation rate (CPI) and industrial production figures, will also influence market movements.
Experts have highlighted potential risks:
- Vinod Nair, Head of Research at Geojit Financial, pointed to the potential inflationary impact of rising crude oil prices and suggested continued market volatility as investors react to earnings and macroeconomic data.
- Siddhartha Khemka, Head of Research at Motilal Oswal Financial, noted the importance of upcoming US non-farm payroll data and India’s CPI release, which could shape near-term market trends.
Technical Insights
The Nifty index is teetering near the downside breakout level of 23,500.
- A decisive move below this level could push the index towards 23,260 or lower in the short term.
- On the upside, immediate resistance is at 23,700, according to Nagaraj Shetti, Technical Analyst at HDFC Securities.
Investors should prepare for continued consolidation and volatility as markets digest a mix of domestic and global cues.
