Mumbai, June 20 (IANS). Investor confidence was strengthened due to increased expectations regarding the peace agreement between America and Iran and the fall in Brent crude prices, due to which the major indices of the Indian stock market were successful in registering strong gains for the second consecutive week.
Nifty registered a gain of 1.65 percent during this week, however, on the last trading day of the week it fell by 0.64 percent and closed at the level of 24,013.10. Whereas Sensex fell by 607 points or 0.78 percent and closed at 76,802. Despite this, the Sensex gained 1.69 percent in the entire week.
Limited trading was seen in the domestic market on the last trading day of the week. After the rise in the recent three trading sessions, the market remained under pressure due to sharp selling in IT stocks.
At the same time, Brent crude prices had fallen below $ 80 per barrel amid the prospects of a US-Iran peace agreement, but at the end of the week the falling prices stopped due to the sudden cancellation of peace talks and profit booking.
During the week, the rupee strengthened by about 79 paise against the dollar to reach around 94.35 per dollar.
Analysts believe that improvement in geopolitical situation may support market sentiment next week also.
A 14-point memorandum of understanding (MOU) was signed between the US and Iran during the week. Under this, it was agreed to reopen the Strait of Hormuz, remove the naval blockade and restore the movement of commercial ships.
Talking about regional indices, shares of consumer durables, real estate, pharma and defense sectors saw good growth.
The defense sector registered a strong gain of 6.6 percent during the week. According to market experts, the strong fundamental condition of the sector was the main reason behind this.
The IT sector was the weakest performing sector of the week. The Nifty IT index recorded a decline of 6.5 percent.
The decline came as global IT company Accenture cut its stablecoin revenue growth forecast for fiscal 2026 and issued a weaker-than-expected outlook.
On the monetary policy front, the US Federal Reserve maintained a cautious and data-based stance and gave limited signals for the future. This strengthened the belief that interest rates could remain at high levels for a long time.
Analysts say that the Reserve Bank of India (RBI) also remains cautious. However, the economic outlook may gradually improve due to the fall in crude oil prices and progress in trade agreements with Britain and the US. Still, it may take one or two more review meetings for a clear policy direction to emerge.
The broader market outperformed the major indices during the week. During the week, the Nifty Midcap 100 index gained 2.62 percent, while the Nifty Smallcap 100 index rose 3.23 percent.
Investors are also keeping an eye on the progress of monsoon in India. The total rainfall so far in the month of June has been recorded 38 percent less than normal and El Nino conditions persist.
Market experts believe that if there is further delay in the progress of monsoon, then concerns regarding sowing of Kharif crops, food inflation and rural demand may increase.
Additionally, India’s PMI and credit growth data, as well as US’s PCE inflation and GDP data may play an important role in deciding the market direction in the coming days.
–IANS
DBP
