More than 90 small-caps post double-digit returns as index outperforms

"The new financial year has commenced on a subdued note, largely driven by the imposition of higher-than-anticipated tariffs by the US. Sectors like IT and metals have underperformed relative to the broader market, reflecting growing concerns over the outlook for the US economy and potential retaliatory trade actions by other countries. Investors are expected to closely monitor any countermeasures implemented by global trade partners, which could further exacerbate geopolitical and economic uncertainty. This cautious sentiment is reflected in the sustained rally in gold and bond prices, underscoring a pronounced shift toward safe-haven assets," said Vinod Nair, Head of Research, Geojit Investments.

"The tariffs imposed on India are relatively lower compared to those on other Asian economies, offering a degree of relief. Any constructive developments arising from the ongoing India–US bilateral trade negotiations could serve as a supportive catalyst for the market. Investor attention is also firmly fixed on the upcoming MPC meeting, with the benchmark interest rate decision expected next week. A favourable outcome could benefit rate-sensitive sectors. In addition, key macroeconomic indicators—namely India’s inflation figures and US jobless claims—will be closely watched, as they are likely to offer critical insights into the underlying economic conditions in both regions," he added.

"Meanwhile, market focus is gradually shifting toward the upcoming corporate earnings season. The initial outlook remains subdued, with the risk of further downward revisions to earnings growth, largely due to tepid demand and continued margin pressures. The IT sector, in particular, is expected to report soft numbers, and investor sentiment will hinge heavily on management commentary. Persistent global growth concerns and the potential for elevated inflation in the US may lead companies to delay discretionary IT spending, further dampening the sector’s near-term outlook," Nair added further.

Foreign Institutional Investors (FIIs) turned net sellers in this week, as they sold equities worth Rs 13,730.49 crore, while Domestic Institutional Investors (DII) bought equities worth Rs 5,632.56 crore.

The BSE Small-cap index shed 1.6 percent with Pokarna, Garware Hi-Tech Films, Avanti Feeds, Gensol Engineering, Blue Jet Healthcare, MPS, Sharda Cropchem, Cigniti Technologies falling between 9-25 percent.

However, Hester Biosciences, Baazar Style Retail, Primo Chemicals, Shiva Cement, Valiant Organics, Nacl Industries, Vadilal Industries, Sportking India, Ganesh Benzoplast, Vardhman Textiles, Parag Milk Foods, Tarsons Products rising between 21-46 percent.

Where is Nifty50 headed?

Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities

Nifty on the weekly chart slipped into weakness after the formation of doji type candle pattern in last week. We observe negative reversal pattern in the last three weekly candles. Hence, more weakness could be in store.

The short-term trend of Nifty remains weak and the downward correction seems to have gained momentum. Further weakness below 22800 levels, Nifty could slide down to the next lower trajectory of around 22350 levels in the near term. Any pullback rally from here could find resistance around 23150 levels.

Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services

Investors will be awaiting US Fed Chair Jerome Powell's speech tonight, for insights into Fed’s assessment of the US economy and clues on the monetary policy outlook following the tariff announcements. Apart from developments on the US tariff front, market focus will be on RBI’s monetary policy announcement on 9th April and the Q4FY25 corporate earnings beginning with TCS results on 10th April next week.

We expect market to remain volatile with sector specific action, tracking RBI’s interest rate decision, pre-quarterly business updates/Q4 results and global market cues.

Aditya Gaggar, Director of Progressive Shares

The market has been adversely affected by Trump’s tariff policies, causing Nifty50 to form a bearish candle on the weekly chart, and in the case of a trend continuation, the Index is likely to slide to 22,600. On the flip side, the daily chart suggests that the Index may be developing the right shoulder of an Inverted Head and Shoulders pattern, which could signal a potential reversal if it closes firmly above 23,800. The immediate resistance and support levels for Nifty50 are placed at 23,150 and 22,780, respectively.

Amol Athawale, VP-Technical Research, Kotak Securities

In the last truncated week, the benchmark indices witnessed selling pressure at higher levels, with the Nifty ends 2.6 percent lower while the Sensex was down by 2050 points. Among sectors, the IT index lost the most, shedding over 9 percent; however, despite the weak market sentiment, some buying interest was seen in PSU Bank stocks, resulting in the PSU Bank index gaining over 1 percent.

During the week, the market breached the crucial support zone of 23,500/77400, and after this breakdown, selling pressure intensified. Technically, on the weekly charts, it has formed a long bearish candle, and on the intraday charts, it is holding a lower top formation, which supports further weakness from the current levels.

We believe that after a sharp correction, the market is currently trading near the 20-day and 50-day Simple Moving Averages (SMAs). The short-term outlook suggests that if the market reclaims the 23,000/75800 mark, we could see a pullback rally up to 23,250-23,325/76500-76800. On the flip side, fresh selling is possible only after a break below 22,800/75200. If that happens, it could slip to 22,700/74900. Further downside may continue, potentially dragging the index down to 22,500/74400.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.