Can Nifty, Sensex rally further or will bears reign in? 5 factors to steer market this week
Sensex and Nifty extended gains for a second straight session on Friday, led by IT stocks, which rose for a fourth consecutive session, along with buying in auto, metal and PSU banking stocks. Nifty’s recovery could continue as long as it holds above the crucial 22,750–22,800 support zone.
The benchmark indices Sensex and Nifty continued their upward momentum for a second consecutive day on Friday. Strong performance from IT stocks, along with buying in auto, metal and PSU banking stocks, propelled the rally. Analysts are closely watching five key factors that could steer the market this week.
Firstly, Q2 earnings results from major banking stocks, particularly HDFC Bank, will be scrutinized. Investors will examine loan growth, deposit mobilization, margins, asset quality, and management commentary to gauge the momentum of the financial sector. HDFC Bank reported a net profit of Rs 19,510 crore for Q2FY27, a 4.6% increase from the same period last year. The bank's net interest income grew 9.7% to Rs 34,620 crore.
Secondly, oil prices continued to rise sharply, reaching $110 for the first time since May. This surge was fueled by Iran's intensified attacks in the Strait of Hormuz, Houthi militants' missile strikes on Saudi Arabia, and Ukraine's pledge to resume strikes on Russian refineries. The uncertainty surrounding the conflict's trajectory has left markets on edge.
Thirdly, IT stocks such as TCS, Tech Mahindra, Infosys, and Wipro delivered a strong week, with gains of up to 17%. This strong performance lifted the Nifty IT component and contributed to the broader index's gains of 12% over the week. The Nifty IT index is now in the leading quadrant of the Relative Strength Index (RSI), indicating strong momentum.
Fourthly, Foreign Institutional Investors (FIIs) have been net sellers for nine consecutive weeks, but their outflows eased significantly to Rs 8,991 crore in the latest week, down from Rs 30,294 crore the previous week. However, FIIs turned net buyers for the ninth straight week, with inflows of Rs 1,166 crore. Domestic Institutional Investors (DIIs) remained net buyers for the ninth straight week, with inflows of Rs 7,813 crore.
Lastly, the Indian rupee continued its upward trajectory for the fifth consecutive session, recording its strongest weekly gain in seven months. The currency rose 2% to Rs 94.96 per US dollar, recovering from last week's slide, which brought the rate close to its record low of Rs 96.96. Analysts caution that sustained recovery will depend on resolving the underlying pressures on the rupee.
Written by urgent.news from The Economic Times - Top News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
