The truncated trading week began on an encouraging note, but the optimism faded as sellers used higher levels to step in, pushing the index back towards key support zones. Buying interest emerged thereafter, helping the Nifty hold above the crucial 23,000 mark.
Despite the recent recovery, the Nifty ended the week lower for the sixth consecutive week, declining 0.22% on a week-on-week basis.
Among Nifty constituents, HDFC Bank and UltraTech Cement were the top gainers, while TCS and TMPV emerged as the biggest laggards. At the sectoral level, Nifty Cement and Nifty Metal saw buying interest, while Nifty IT remained under pressure.
The broader market outperformed the benchmark, with the Nifty Midcap 100 gaining 1.24% and the Nifty Smallcap 100 rising 1.74%.
Indian equities have found some relief over the past three sessions as Brent crude retreated. Progress on repairs to Saudi pipelines and alternative export routes helped ease concerns over a prolonged disruption in supply.
With the Fed rate decision now behind us, moderating Treasury yields, crude prices off their highs and strong domestic liquidity could support a cautiously positive bias in the near term.
However, risks remain, with Brent still above $100 a barrel and the rupee hovering near ₹96 to the dollar. Geopolitical tensions, global bond yields and foreign investor flows will also remain key factors for the market.
Investors will track India’s September flash PMI, August infrastructure output, foreign-exchange reserves and bank credit growth for domestic cues. Global markets will focus on US industrial production and consumer sentiment, along with China’s Loan Prime Rate decision.
The US State Department warned Americans to reconsider traveling to the Middle East, adding that the Iran war could quickly worsen, as Tehran maintained a defiant stance over the Strait of Hormuz.
“This military conflict has the potential to escalate rapidly. Americans outside the Middle East should seriously reconsider travel to and through the region,” the State Department said in a post on X.
Iran-backed Houthi rebels based in Yemen said they attacked “sensitive” sites in the Saudi Arabian capital Riyadh with missiles and drones on Saturday. The Houthi claims came hours after flames and a large plume of smoke were seen near the city’s main airport, but local authorities have not cited the cause.
Technical outlook
On the technical front, further upside could face strong resistance in the 23,500-23,600 zone, while weakness could find support around 23,100-23,000, according to Nagaraj Shetti of HDFC Securities.
Sudeep Shah of SBI Securities said the 23,180-23,150 zone is likely to remain a crucial support area. A sustained break below 23,150 could increase selling pressure towards 23,000, while 23,500-23,520 is expected to act as the immediate hurdle. A sustained move above 23,520 could trigger short covering and extend the recovery towards 23,650, he added.
Rupak De, Senior Technical Analyst at LKP Securities, said a sustained uptrend in the short term could emerge if Brent crude stays below $96 a barrel. For the Nifty, he sees support at 23,000-23,100, while the ongoing recovery could take the index towards 23,550.
Hitesh Rathi of Angel One said the 23,100-23,000 band remains a key support zone, with immediate support placed at 23,250-23,200. On the upside, resistance is seen at 23,450-23,500, while 23,600, which previously acted as support, could now turn into resistance.