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The Indian stock markets, represented by the benchmark indices Sensex and Nifty 50, staged a comeback on Friday, ending a three-day losing streak. The rally was primarily fueled by gains in Axis Bank, which bolstered the heavyweight financial sector. However, despite the positive close, foreign fund outflows continued to weigh on the benchmarks, leading to their third consecutive weekly decline.
The Nifty 50 index closed 0.42% higher at 24,854 points, after hitting a two-month low earlier in the session. The S&P BSE Sensex also mirrored the gains, adding 0.27% to close at 81,224 points. Market analysts attributed the rebound to a technical rebound, with Rupak De of LKP Securities highlighting a positive divergence in the RSI (14) on the hourly chart, suggesting a shift towards positive price momentum.
Despite the recent rebound, market sentiment remains cautious. Tejas Shah of JM Financial & BlinkX stated that while the Nifty 50's hold above the 24,700 mark indicates a lack of panic, the market is still considered oversold and under the influence of bearish sentiment. The immediate support level for the index is seen at 24,700-750 and 24,500, while the immediate resistance level is at the psychological barrier of 25,000, with a further resistance zone located at 25,250-300 levels.
In contrast to the Indian market, the US stock markets continued their upward trajectory, achieving record closing highs for the Dow Jones Industrial Average and S&P 500 on Friday. The Nasdaq also ended in positive territory. The surge in these markets was attributed to earnings-driven gains in Netflix shares and a broader rally across technology stocks. This positive momentum resulted in all three major Wall Street benchmarks securing their sixth consecutive weekly gain, marking their longest winning streak since late 2023.
The S&P 500 gained 0.9% for the week, the Nasdaq Composite advanced 0.8%, and the Dow Jones Industrial Average climbed 1%. This sustained bullish sentiment in the US markets highlights the strong performance of the technology sector and the positive impact of corporate earnings releases.
European markets also experienced a positive week, with the STOXX 600 index ending higher on Friday. The tech sector led the gains with a 2% jump, fueled by a combination of a strong comeback after a bumpy week and the European Central Bank's rate cut. The STOXX 600 index delivered its second straight week of gains, reflecting a positive outlook for the European markets.
Source: Ahead of Market: 10 things that will decide stock action on Monday