The Indian stock market has been in a consolidation phase this week. During this period, Sensex and Nifty recorded a decline of about half a percent. The reason for this decline is believed to be weak global signals and trade war. But the question arises as to how the coming week will be for the market.
Sensex and Nifty started on a positive note this week. Buying was seen in pharma, metal and energy stocks. However, largecap stocks saw selling after the US threatened new tariffs. This dampened the market sentiment. Buying was seen in midcap and smallcap indices and both indices closed up nearly 2 per cent on a weekly basis. The market volatility has come at a time when concerns over reciprocal tariffs and global economic stability are weighing on investor sentiment.
Vinod Nair of Geojit Financial Services said, “US President Donald Trump’s announcement of reciprocal tariffs has severely impacted export-oriented industries, especially the pharmaceutical sector, and the sector has performed poorly. The market may continue to remain volatile in the coming times. This is due to the short trading week due to holidays and monthly expiry of derivatives contracts.
Vaibhav Porwal, co-founder of Deserve, said, the flow of foreign institutional investors (FIIs) may return to India in the next 3-6 months. This is because the Indian economy is strong in the long term. He further said that corporate earnings are likely to increase in the long term due to strong domestic demand, digital transformation and emphasis on infrastructure. Indian stock market closed in the red on Friday. Sensex fell 424.90 points to 75,311.06 and Nifty fell 117.25 points to 22,795.90.