Investors Wary Of Uncertainty Amid Sluggish Global Cues

Most commodities found relief due to bullish growth estimates from China and a sharp weakness in the US dollar

Despite volatile global markets due to uncertainty around US trade policy and flat macroeconomic data on the home front; the Indian market snapped three week losing streak to record biggest weekly gain in 2025 in the week ended. BSE Sensex index added 1,134.48 points or 1.54 per cent to end at 74,332.58, and Nifty rose 427.8 points or 1.93 percent to finish at 22,552.50. Pullback from oversold conditions saw the BSE Mid-cap Index add 3.3 percent and the BSE Small-cap index rise nearly six per cent. FIIs continued their selling in the current month also as they sold equities worth Rs15,501.57 crore during the week ended. Continuing their support, DIIs bought equities worth Rs20,950.89 crore. The cumulative FII equity outflows for 2025 have already reached over Rs1.30 lakh crore, reflecting a sustained risk-off sentiment among foreign investors. The continued outperformance of Chinese equities has been a key factor diverting FII flows from India. Chinese stocks have seen big buying triggered by attractive valuations and expectations from the recent positive initiatives by the Chinese government towards their big businesses. However, there are now signs of slight decline in the intensity of FII selling in the last few trading sessions indicating stabilization in Indian equities if macroeconomic conditions improve. Investors are cautious as they watch global factors and rely on the upcoming Q4 corporate earnings to assess whether foreign investor sentiment will turn favourable in the coming months. Escalating trade tensions, coupled with signs of weakness in the US economy, weighed on risky assets, while most commodities found relief due to bullish growth estimates from China and a sharp weakness in the US dollar.

The Indian rupee added 63 paise to end at 86.88 per dollar during the week ended, one of its best weeks in recent times. International crude oil prices have hit a six-month low following OPEC+’s decision to increase production and persistent growth concerns in the US A decline in crude prices is beneficial for India, a major oil importer, as it helps curb inflation and improves corporate profit margins, particularly for energy-intensive industries. All the sectoral indices ended in the green with Nifty Metal index surged 8.6 percent, Nifty Media index added 7.3 percent, Nifty Energy index rose six per cent, Nifty Oil & Gas index jumped 5.3 percent and Nifty PSU Bank index added 5 per cent. The market capitalization (mcap) of BSE-listed companies rose more than Rs14 lakh crore. Weekend comments from Finance Minister over changes in GST may provide succour to beleaguered bulls. During next fortnight, the release of the Index of Industrial Production (IIP) and Consumer Price Index (CPI) inflation data will provide insights into economic momentum of Indian economy. Additionally, investors will track US inflation data, non-farm payroll figures, and developments on US trade tariffs, all of which could impact global market sentiment.

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F&O / SECTOR WATCH

Mirroring the bounce-back in the cash market, the derivatives market witnessed a sharp rebound from lower levels accompanied by robust volumes and ended the week on a positive note. Nifty snapped three week losing streak, but the Bank Nifty ended nearly unchanged over the week. Expectedly, the Metal and PSU segments were among top gainers. In the options segment, highest Call Open Interest was seen at 23,000 followed by 23,500. Marginal Put writing was observed at 22,500 strike, while Call writers seen shifting at 22,800 strike with highest Open Interest concentration. Implied Volatility (IV) for Nifty’s Call options settled at 12.73 per cent, while Put options concluded at 13.20 per cent. The India VIX, a key market volatility indicator, closed the week at 13.73 per cent. The Put-Call Ratio of Open Interest (PCR OI) stood at 1.17 for the week. For markets to rise from here on, a possible trigger could be resurgence in buying interest in major banking stocks, which have mostly remained on the side-lines during the recent rebound.

In near term, the Nifty has a major support now in the band of 22,300-22,000 and for Bank Nifty 48,000-47,800 zone would act as a support area. Expect the heightened volatility to continue with global uncertainties weighing on sentiments. Fresh short selling is not advised for present; advise traders to maintain positive bias with cautious stance.

Stocks looking good are Adani Energy, Eicher Motors, IIFL, Jindal Steel, SRF, Tata Technologies and Marico. Stocks looking weak Apollo Hosp, AU Bank, Balakrishna Inds, Jubilant Foods, Policybazar, MCX and Paytm.

(The author is a senior maket analyst and former vice- chairman, Andhra Pradesh State Planning Board)

STOCK PICKS

Shaily Engineering Plastics Ltd

Shaily Engineering Plastics Ltd is an exporter of engineering plastics components. It operates through the manufacture and sale of customized components made up of plastic and other materials. It manufactures value-added products from ultra-high-performance engineering plastics that find application in sectors such as: consumer-home furnishings, medical devices, fast-moving consumer goods (FMCG), pharma packaging, automotive, consumer electronics, and others. Its diversified business platform includes Healthcare, Consumer, and Industrial. Its healthcare division has developed a proprietary portfolio of medical and drug delivery injectable devices including pen injectors, auto-injectors, wearable injectors, and other specialty devices. Its consumer division consists of home furnishings, FMCG packaging, light-emitting diode lights, toys and carbon-steel furniture segments. Its industrial division comprises automotive components, appliances and high-performance engineering components. The company manufactures carbon steel furniture, supplied to the large global home furnishings major. Currently, its order book exceeds an estimated H1bn, wherein it has received orders for 6 new products in the steel furniture segment. The company expanded its presence in the toys sector by partnering with Spin Master, a prominent global toy company. Buy on declines for target price of Rs2,500 in medium term.