Metal, Media, Energy indices top gainers this week; geopolitical tension, crude prices remain major triggers for next week

Domestic stock market closed third straight day and four out of five sessions in the red, primarily concerns arising out of Russia-Ukraine war and surge in crude prices along with Fed rhetoric. 

Benchmarks Nifty50 and the S&P BSE Sensex closed 0.40 and 0.41% lower respectively, under pressure from IT, Pharma, consumer durables and FMCG stocks. The benchmarks found some support from Realty, PSU Bank, Oil & gas stocks as Nifty closed above 17,150 and Sensex settled at 57,362.20.  

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"After a strong rally last week, the market turned sideways with a negative bias as global cues haunted domestic investors, forcing them to stay sidelined. Elevated crude prices, tightening monetary policy by Fed, higher inflation levels along with rising covid cases in parts of the world led to this downtrend, said Vinod Nair, Head of Research at Geojit Financial Services. 

How indices fared this week

Meanwhile, Nifty50 and Sensex declined 0.8% and 0.9% respectively for the week ending March 25. Media, metal and energy sectors witnessed buying interest this week as they provided much-needed resilience allowing barometer indices to trade above crucial support levels. 

On the BSE, S&P BSE Metal, S&P BSE Energy, S&P BSE oil & gas, S&P BSE Momentum Index and S&P BSE Basic Material were top 5 gainers on the exchange. They ended the week with gains of 5.5%, 3.6%, 2.7%, 2.2 and 1.7% respectively. 

Nifty media with 7% gain was the leading index on the NSE. Nifty Metal (5.1%), Nifty Oil & Gas (3%), Nifty Commodities (2.3%) and Nifty Energy (2.1%) were other leading gainers.

Meanwhile, FIIs returning on buying side was some respite for the market. 

"FIIs turning into buying mode is a positive for the market, however, due to the ongoing global uncertainties, domestic retail investors lacked the confidence to take fresh positions, said Nair

Ease in covid restrictions in India are also boost to sectors like hospitality, multiplex, transportation, etc leading to their outperformance. 

Triggers for Next week

The triggers largely remain geopolitical skirmishes. The domestic market will continue to follow global developments, said Vinod Nair. "An end to the war and rise in oil supply can help India to sustain its resilience, or else high volatility will be a concern in the short-term, " he added. 

Technical Check:

Amol Athawale, Deputy Vice President, Technical Research, Kotak Securities Ltd, says with Nifty near the 50-day SMA or 17400 level, the market is consistently facing selling pressure which is broadly negative. On weekly charts, the Nifty has formed a small bearish candle that also indicates further weakness. 

"We are of the view that as long as the index is trading below 17325, the correction wave is likely to continue in the near future and below the same, the chances of hitting a 200-day SMA or 17000 would turn bright. On extended weakness, the index may fall up to 16900-16870 levels. On the other hand, fresh uptrend is possible only after the level of 17325. Above the same, one quick pullback rally till 17400-17450 is not ruled out," added Athawale

Disclaimer: The views/suggestions/advice expressed here in this article are solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.