Amidst the previous week, the financial markets gradually underwent a descent of approximately 2%, chiefly influenced by feeble domestic indications. The prevailing pessimistic aura, compounded by a continual escalation in the India VIX, denoted a surge in volatility. Furthermore, the offloading of specific prominent equities in response to their financial results contributed to the downward trajectory as the week transpired. Ultimately, both the Nifty and Sensex, serving as pivotal gauges, concluded perilously close to their nadirs for the week, resting at 22,055.20 and 72,664.47 respectively. Key sectors such as financials, energy, and metals bore notable losses, whereas FMCG, automotive, and IT sectors showcased resilience, mitigating the overall impact. Broader indices also witnessed downturns spanning from 2.7% to 5%.
Notwithstanding the adverse local sentiment, the resilience detected in international markets, particularly in the US, played a pivotal role in attenuating the rate of descent. It remains imperative for investors to diligently monitor both global market dynamics and domestic variables for market insights. The prognosis hints at a perpetuation of the pessimistic sentiment in the Nifty, subsequent to its divergence from the ascending trend on the daily chart. The focal point now pivots towards the 21,800 mark as a pivotal yardstick for the index, with a prospective breach indicating a shift towards the 21,200-21,400 spectrum. Conversely, a resurgence would confront substantial opposition around the 22,350-22,500 corridor. Given the strain prevailing across most sectors, traders are counseled to adapt their positions accordingly, confining long positions to sectors such as FMCG and automotive that exhibit vigor amidst the downturn.
