Broader indices log biggest weekly decline in 4 months; over 200 small-caps see double-digit losses

So far this month, the BSE Sensex and Nifty50 have each declined 4 percent, while the BSE Midcap and Smallcap indices have fallen 5.7 percent and 9 percent, respectively.

• Broader indices fell 4–6 percent, marking the biggest weekly drop in four months
• Foreign investors sold Rs 14,651 crore in equities; rupee hit a fresh low
• Cautious market sentiment may push Nifty down to 24,600 soon.

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Broader indices fell 4–6 percent, logging their biggest weekly decline in four months and underperforming the benchmark indices amid mixed earnings from India Inc, continued foreign investor outflows, and the rupee hitting a fresh low.

The BSE Sensex declined 769.67 points, or 2.43 percent, to close at 81,537.70, while the Nifty50 shed 241.25 points, or 2.51 percent, to end at 25,048.65.

So far this month, the BSE Sensex and Nifty50 have each declined 4 percent, while the BSE Midcap and Smallcap indices have fallen 5.7 percent and 9 percent, respectively.

All the sectoral indices gave negative return with Nifty Realty shed more than 11 percent, Nifty Consumer Durables index slipped 6.5 percent, Nifty Media plunged 4 percent, Nifty Oil & Gas, Energy, Infra, Defence, Healthcare fell 3 percent each.

Foreign Institutional Investors (FIIs) offloaded equities worth Rs 14,651.99 crore during the period, while Domestic Institutional Investors (DIIs) offset the selling with purchases worth Rs 20,746 crore.

"Indian equity markets remained cautious and volatile through the week, pressured by renewed global trade tensions and continued foreign investor outflows. Fresh U.S. tariff threats against European nations linked to the Greenland issue dampened global risk appetite, prompting a shift toward safe-haven assets. Moreover, rising global bond yields and uncertainty surrounding the U.S. Supreme Court’s review of Trump-era tariffs further restrained risk-taking," said Vinod Nair, Head of Research, Geojit Investments.

"Corporate earnings reinforced the mixed sentiment, as weaker results from leading banking and IT companies tempered market enthusiasm, although selective value buying offered intermittent support. While global cues briefly improved following constructive remarks from the U.S. President on the Greenland issue, the domestic market’s rebound was short-lived, highlighting the persistence of external headwinds for India."

"Market direction in the coming week is likely to be driven by global macroeconomic signals and domestic fiscal expectations. Investors will closely track guidance from the Fed on the trajectory of interest rate cuts, while positioning may be influenced by anticipation surrounding the Union Budget, particularly any measures aimed at easing external trade pressures and supporting capital flows," Nair said.

"With the Q3 earnings season still underway, stock-specific movements are expected to remain prominent. Overall sentiment is likely to stay cautious, shaped by global developments, currency trends, and earnings outcomes, with selective opportunities emerging in segments supported by resilient domestic demand," he added.

The BSE Small-cap index declined shed nearly 6 percent with Best Agrolife, Sudarshan Colorants India, Wardwizard Innovations and Mobility, Systematix Corporate Services, Ajmera Realty and Infra India, Sigachi Industries, Wanbury, OneSource Specialty Pharma, IIFL Finance, Jayaswal Neco Industries, Ramco System, Authum Investment & Infrastucture, Arisinfra Solutions, Bigbloc Construction falling between 17-25 percent, while gainers included Dhampur Bio Organics, Lotus Chocolate Company, Baazar Style Retail, Jindal Saw, Shanthi Gears, Mercury Ev-Tech.

Where is Nifty50 headed?

Hitesh Tailor, Research Analyst, Choice Equity Broking

The 81,000–81,100 zone is emerging as a crucial support area for the Sensex, acting as a cushion where dip-buying interest may surface if weakness deepens. On the upside, 82,000–82,100 stands as the immediate resistance band, where any short-term rebound is likely to encounter supply pressure and profit booking.

With the index ending decisively below recent intermediate levels and broad-based selling dominating the session, the near-term bias remains cautious to bearish. Selective accumulation may be considered only if the key support zone holds and clear buying interest re-emerges."

Amol Athawale, VP – Technical Research

We are of the view that as long as the market trades below the 100-day SMA or 25500/83000, the weak formation is likely to continue. On the downside, 24900/81100 would act as an immediate support zone. Below this level, selling pressure is likely to accelerate. Further below, the market could slip to 24700,–24,500/80500-80000. On the upside, above 25,200/82000, we could see a quick pullback up to 25,350–25,500/82500-83000.

For Bank Nifty, 58,000 would act as a key level for traders. Below this, the correction wave is likely to continue until 57,500–57100. Conversely, above 59,000, it could bounce back up to 59,350–59,500.

Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities

After showing a bounce back in the last couple of sessions, Nifty slipped into sharp weakness on Friday and closed the day lower by 241 points. After opening on a positive note, the market was not able to sustain the opening gains and started with weakness since early part of the session. The weakness got intensified in the mid to later part and Nifty finally closed at the lows.

A long bear candle was formed on the daily chart which indicates a formation of lower top reversal pattern at the recent swing highs of 25400 levels. Nifty on the weekly chart formed a long bear candle this week after the minor bounce of last week. The overall chart pattern remains negative and one may expect Nifty sliding below the recent low of 24900 by next week. The near-term downside target to be watched around 24600. Immediate resistance is placed at 25200 levels.

Rupak De, Senior Technical Analyst at LKP Securities

The index remained weak throughout the session as it stayed below the 20 EMA on the hourly chart. In addition, the index has finally slipped below the 200 DMA on a closing basis, suggesting capitulation by the bulls after a futile attempt to defend the crucial long-term moving average.

As a result, short- to medium-term sentiment is likely to remain weak as long as the index trades below 25,500. On the downside, the decline could extend toward 24,700 in the short term.

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