Indian stock market benchmark indices registered a third consecutive weekly gain, supported by declining crude prices and increased buying in domestic-facing sectors. However, profit booking and ongoing foreign outflows kept investors cautious ahead of an extended weekend. The Sensex rose 0.4% to 77,100.5, while the Nifty 50 gained 0.2% to 24,056. This modest advance highlights a lack of conviction despite the winning streak.
The market’s cautious stance developed amid lingering global uncertainties, even as easing geopolitical tensions in West Asia and sharply lower crude oil prices improved overall sentiment. Profit booking on Thursday, before markets closed for Muharram on Friday, indicated investors were paring positions. Geopolitical risks and crude oil volatility continue to influence the global macro outlook.
Real estate stocks led the gains for the week, climbing 2%, with the auto sector closely following. Financials and healthcare also saw increases of just over 1% each. This selective buying contrasted with weakness in global-facing and commodity-linked sectors. Metals fell 4.7%, capital goods shed 3.1%, and power stocks declined 2.9%.
Thursday’s market performance saw automobile and heavyweight banking stocks provide significant support to the benchmark indices. Mahindra & Mahindra, Maruti Suzuki, ICICI Bank, and State Bank of India were among the top contributors. These gains occurred as the Nifty initially reached its highest level since the US-Iran peace agreement was signed, before giving back most of its advances in late trade.
Improved retail demand and softer metal prices contributed to the outperformance of auto stocks, according to Pranay Aggarwal, director and CEO of Stoxkart. Lower input costs for car makers helped ease financial pressures. This trend suggests a positive reaction to specific sector conditions rather than broad market enthusiasm.
Softer crude prices have enhanced sentiment for rate-sensitive and domestic-facing sectors, said Rajesh Singla, chief executive and fund manager at Alpha AMC. He anticipates continued relative strength in healthcare, financials, and realty. This outlook suggests a divergence in sector performance based on their sensitivity to economic factors.
Conversely, the metals sector may experience further profit booking following its strong year-to-date rally. The information technology segment also remained weak, with its index down almost 1% during the week. Concerns over artificial intelligence-led disruption and weak discretionary technology spending continue to pressure IT stocks.
The market’s immediate future remains subject to global macroeconomic shifts and investor sentiment regarding geopolitical stability. The ongoing foreign outflows and profit booking suggest a cautious approach will likely persist. Investors will watch for sustained improvements in global conditions and domestic economic indicators to gauge future direction.