The Indian stock market has been on a roll lately, clocking up strong gains over the last seven weeks. But the Nifty 50 index appears to have taken a breather this week, as it closed lower on Friday.
The benchmark Nifty 50 index ended 0.02% lower on Friday at 10,860.15 and is down 0.6% this week. The Sensex 30, which had gained 6.7% over the past seven weeks, also witnessed some profit booking and closed 0.3% lower at 36,688.75.
The sell-off in Indian stocks was in line with global markets, which have been under pressure due to rising bond yields and concerns about a resurgence in virus cases.
Nevertheless, analysts are confident that the current pullback will be short-lived and are optimistic that the market will soon resume the bullish momentum it has enjoyed over the last seven weeks.
Back home, the sharp rise in Indian stock markets can be largely attributed to the improvement in the domestic macroeconomic data and the rollout of the Covid-19 vaccine. Moreover, the ongoing Budget session has brought in considerable optimism that the new fiscal year will be one of robust economic growth.
Looking ahead, experts expect markets to remain quite volatile for the coming weeks.
Moving on to sectoral trends, the banking, financial services and IT sectors have been the primary contributors to this bull run over the last seven week.
The banking sector saw gains in the wake of an RBI initiative to bring in additional liquidity of Rs 1.2 trillion into the financial system, aiming to reduce borrowing costs for corporate borrowers. The IT sector has been buoyed by growing demand for digital services in a post-pandemic world.
On the flip side, the pharma and healthcare sector has been slowing down, partially due to the government’s decision last week to rollback the non-essential drugs price cap hike.
All in all, Indian stocks have had a fair run this year and continue to present good investment opportunities. However, investors should have an appropriate asset allocation in mind and stay prepared for any potential bouts of volatility.
The Indian stock market has been on a roll lately, clocking up strong gains over the last seven weeks. But the Nifty 50 index appears to have taken a breather this week, as it closed lower on Friday.
The benchmark Nifty 50 index ended 0.02% lower on Friday at 10,860.15 and is down 0.6% this week. The Sensex 30, which had gained 6.7% over the past seven weeks, also witnessed some profit booking and closed 0.3% lower at 36,688.75.
The sell-off in Indian stocks was in line with global markets, which have been under pressure due to rising bond yields and concerns about a resurgence in virus cases.
Nevertheless, analysts are confident that the current pullback will be short-lived and are optimistic that the market will soon resume the bullish momentum it has enjoyed over the last seven weeks.
Back home, the sharp rise in Indian stock markets can be largely attributed to the improvement in the domestic macroeconomic data and the rollout of the Covid-19 vaccine. Moreover, the ongoing Budget session has brought in considerable optimism that the new fiscal year will be one of robust economic growth.
Looking ahead, experts expect markets to remain quite volatile for the coming weeks.
Moving on to sectoral trends, the banking, financial services and IT sectors have been the primary contributors to this bull run over the last seven week.
The banking sector saw gains in the wake of an RBI initiative to bring in additional liquidity of Rs 1.2 trillion into the financial system, aiming to reduce borrowing costs for corporate borrowers. The IT sector has been buoyed by growing demand for digital services in a post-pandemic world.
On the flip side, the pharma and healthcare sector has been slowing down, partially due to the government’s decision last week to rollback the non-essential drugs price cap hike.
All in all, Indian stocks have had a fair run this year and continue to present good investment opportunities. However, investors should have an appropriate asset allocation in mind and stay prepared for any potential bouts of volatility.
