Broader indices outperform, these smallcaps gain between 10-42%

The broader indices outperformed the main indices amid volatility as investors remained cautious ahead US tariff deadline of July 9, with all eyes on the anticipated US-India trade deal.

Among broader indices, the BSE Small-Cap index rose 1 percent, the BSE Mid-Cap index up 0.6 percent, while the Large-Cap index shed 0.6 percent.

For the week, the BSE Sensex index shed 626.01 points or 0.74 percent to close at 83,432.89, and Nifty50 fell 176.8 points or 0.68 percent to end at 25,461.

The Foreign Institutional Investors (FIIs) broke a two-week buying streak as they sold equities worth Rs 6,604.56 crore. On the other hand, Domestic Institutional Investors (DII) continued their buying in the 11th consecutive week as they purchased equities worth Rs 7,609.42 crore.

Mixed performance was seen on the sectoral front with the Nifty Realty index shed 2 percent, Nifty Bank index shed 0.7 percent, Nifty FMCG index fell 0.7 percent, while Nifty Consumer Durable index up 2.7 percent, Nifty Healthcare, Pharma, PSU Bank indices added 2 percent each, Nifty IT and Media indices jumped nearly 1 percent each.

"In the last week, the benchmark indices witnessed selling pressure at higher levels. Technically, on intraday charts, it is holding a lower top formation, and on weekly charts, it has formed a bearish candle, which is largely negative. However, the short-term market texture still appears to be positive. We believe that currently, the market is witnessing non-directional activity; perhaps traders are waiting for either side breakout," said Amol Athawale, VP-Technical Research, Kotak Securities.

"For the bulls, 25,500/83600 would act as an immediate resistance zone. If the market succeeds in trading above this level, it could move up to 25,670/84100. A successful breakout above this could push the market towards 25,800–25,900/85000-85300. On the flip side, if the market falls below 25,300/83000, sentiment could turn negative. Below this level, the market could slip to 25,000–24,950/82100-81900."

"For Bank Nifty, the 20-day SMA (Simple Moving Average) at 56,500 is a key level to watch. Below this, Bank Nifty could decline to 56,200–56,000. On the other hand, as long as it remains above 56,500, the chance of reaching 57,500–57,800 remains bright," he added.

The BSE Small-cap index rose 1 percent with Gabriel India, Sindhu Trade Links, PC Jeweller, SML Isuzu, Nacl Industries, Heranba Industries, Prime Focus, and Signpost India rising 20-42 percent. On the other hand, Sadhana Nitrochem, Sigachi Industries, Dreamfolks Services, Nuvama Wealth Management, Sammaan Capital, Jindal Worldwide, and Narayana Hrudayalaya fell between 11-22 percent.

Where is Nifty50 headed?

Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities

A small positive candle was formed with a long lower shadow on the daily chart on Friday, which indicates a possibility of the emergence of buying interest from near the crucial supports of around 25300 levels. The bullish chart pattern with higher tops and bottoms is intact,t and the current weakness in the market could be in line with the new higher bottom formation. The higher bottom reversal pattern needs to be confirmed with more upside.

Nifty on the weekly chart formed a reasonable negative candle pattern this week after an excellent upside breakout of a broader high-low range of around 24500-25200 levels in the last week. Hence, the Nifty is at the crucial support of previous broken resistance as per the concept of change in polarity.

The next upside to be watched is around 25700 for next week, and 26200 for the next two weeks, and immediate support is placed at 25300.

Rupak De, Senior Technical Analyst at LKP Securities

The daily chart of the Nifty shows the formation of a hammer pattern, which is generally considered a bullish reversal signal. Key support lies at 25,300, and as long as the index remains above this level, bullish sentiment is expected to persist, with the potential for a swift rebound.

On the higher side, the index could advance towards 25,800–26,100 in the near term.

Immediate resistance is placed at 25,500; a breakout above this level could further strengthen the upward momentum.

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