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News Topical, Digital Desk : Indian stock markets closed with modest gains on the weekly expiry day. After four consecutive days of decline, the Sensex and Nifty posted a welcome gain today. The Sensex rose 159 points to close at 85,265, while the Nifty gained 48 points to close at 26,034. However, the Bank Nifty came under pressure and fell 60 points to close at 59,289. After the initial decline, the stock market recovered, with buying seen in IT stocks.
The mid-cap and small-cap indices closed flat, but recovered from lower levels. Nifty Bank also closed cautiously after a weak start. IT stocks saw strong buying, supporting the market. Meanwhile, realty, FMCG, and auto indices also remained strong. On the other hand, consumer durables and energy stocks were under pressure, limiting the market's gains.
Why the market is under pressure: 1. Rupee pressure: The rupee fell 28 paise to a new low of 90.43 against the US dollar in early trade. A weakening currency typically dampens market sentiment as it makes foreign investors cautious. 2. Continued FII selling: Foreign institutional investors sold equities worth ₹3,206.92 crore on Wednesday, marking the fifth consecutive session of withdrawals. Continued selling by foreign investors continues to pressure domestic equities. 3. Caution ahead of RBI policy: The Monetary Policy Committee of the Reserve Bank of India will announce its policy decision on Friday. With growth remaining strong and the rupee weakening, investors are unsure whether the central bank will signal any change in its stance. Experts say the falling rupee and continued FII outflows are weighing on sentiment, while upcoming RBI and Fed policy decisions and geopolitical developments could introduce fresh volatility. 4- Weekly Expiry: Volatility increased as traders squared off positions ahead of weekly derivatives expiry, leading to frequent fluctuations between positive and negative territory. 5- Strong Crude Oil Prices: Brent crude rose 0.35 percent to $62.89 per barrel. Higher crude oil prices destabilize the domestic market as they can increase import costs and impact inflation expectations.
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