Despite fear of tariffs, NIFTY moved up
The Indian markets wrapped up the first week of October on a positive note, powered by strong momentum in metals and PSU banks, and steady domestic inflows that offset FII selling pressure. The impact of the Tariffs seems to have cooled down a bit, though it hangs like “a Damocles sword” and can pop up any time soon with renewed volatility.
Market Snapshot
The Nifty 50 closed the week around 24,894, gaining nearly 0.96% over the previous week. Broader markets also joined the party — the Nifty Midcap 100 rose ~0.8%, and the small cap 100 gained ~0.7%.
Volatility cooled off too, with the India VIX slipping over 2% to just above 10, reflecting growing market confidence.
Sectoral Highlights
- Metals were the week’s star performers, driven by firm global prices and improved demand sentiment.
- PSU Banks extended their rally as investors continued to bet on stronger credit growth and cleaner balance sheets.
- Consumer Durables also saw a pickup ahead of the festive season, coupled with the reduction in prices as announced in the GST re-jig
- On the flip side, Realty, Auto, and Healthcare saw mild profit-taking.
Key Drivers This Week
- RBI Governor Shaktikanta Das reaffirmed India’s economic resilience, citing strong reserves, moderate inflation, and a manageable current account — a soothing message for investors.
- IPO activity stayed strong, with Tata Capital’s IPO grabbing headlines after raising over $500 million from anchor investors.
Fundamental View
The earnings season is set to pick up pace soon, but the undertone remains healthy. Metals and financials continue to lead on improved operating leverage, while consumption-driven sectors are seeing early festive tailwinds.
Valuations, however, remain high — suggesting markets will need sustained earnings delivery to justify higher levels. FII’s have been net sellers in the 2 trading days of Oct (₹3189 crores), but domestic institutions and SIP flows are keeping the floor intact. Macro-wise, inflation and rupee movement are two key watchpoints as we head deeper into the festive quarter.
Technical View
The Nifty has successfully reclaimed its short-term moving averages and turned the 24,740–24,750 zone into a strong base. Immediate support lies near 24,600, while resistance is seen around 24,900–25,000.
A decisive close above 25,000 could trigger the next leg toward 25,150–25,400, while a breakdown below 24,600 might signal short-term weakness. Momentum indicators (like RSI and MACD) are turning positive, but overbought conditions could lead to intermittent pauses.
An upward move could also make the 10EMA cross above the 20EMA initiating a bullish move in the short term
The Week Ahead
With global cues turning calmer and the RBI’s stance remaining supportive, traders may continue to see buying-on-dips opportunities.
For investors, staying focused on companies with earnings visibility, strong balance sheets, and technical strength will be key as the Q2 results season approaches.
Outlook: Mildly bullish
Nifty range: 24,600 – 25,400
Tone: Cautious optimism with a focus on stock selection
Disclaimer: This update is for informational purposes only and not investment advice. Please consult your financial advisor before making investment decisionsTop of Form
