Indian Stock Markets Record Second Consecutive Week Of Consolidation

Indian stock markets ended the week cautiously, marking their second straight week of consolidation amid ongoing global trade tensions and anticipation over key domestic policy decisions, analysts said on Saturday.

Markets Close Lower Amid Volatility

The Sensex and Nifty experienced notable volatility throughout the week, eventually closing lower as investors reacted to uncertainties surrounding US tariff developments and awaited the Reserve Bank of India’s (RBI) upcoming monetary policy announcement.

The Nifty settled at 24,750.70, while the Sensex closed at 81,451.01.

Ajit Mishra, SVP of Research at Religare Broking Ltd, said, “Despite encouraging domestic cues, mixed signals from global markets kept investor sentiment on edge. Initially, optimism prevailed following the RBI’s record dividend payout and positive updates regarding the monsoon.”

Sectoral Performance Shows Divergence

The realty index extended its winning streak for the third consecutive week, while banking and energy sectors also ended the week with gains.

Conversely, FMCG, auto, and metal stocks underperformed and emerged as the top laggards.

Midcap and smallcap indices bucked the trend by posting gains of nearly 1.5% each despite the choppy trading environment.

Vinod Nair, Head of Research at Geojit Investments Ltd, noted that the back-and-forth on US trade policies under President Donald Trump reiterates that global markets will continue to grapple with macroeconomic concerns, creating ripple effects in emerging markets.

Favourable Domestic Indicators Provide Cushion

Nair added, “Domestic economic indicators remain favourable, with a better monsoon forecast, benign inflation, and a strong Q4 GDP growth of 7.4%, which may protect the markets from significant downside. The market currently prices in a 25 basis points rate cut, expected to boost rate-sensitive sectors.”

Market participants are now focused on the RBI’s Monetary Policy Committee (MPC) meeting scheduled for June 6.

The central bank’s stance on interest rates, especially amid mixed economic signals, will be crucial in determining the near-term market direction.

Upcoming Economic Data And Global Factors To Influence Markets

Investors will also watch upcoming high-frequency economic data, including auto sales and monsoon progress.

Additionally, foreign institutional investor (FII) flows and developments in the US bond market, along with ongoing trade negotiations, will continue to shape investor sentiment globally.

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