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Below the Quote on Weekly Market Outlook from Mr. Ajit Mishra, SVP – Research, Religare Broking

Market Summary

Markets witnessed volatile yet positive trading during the truncated week, extending their winning streak to three consecutive weeks. Sentiment remained constructive for most of the week, although profit booking on Friday trimmed the gains. Consequently, the Sensex advanced 0.70% to settle at 81,592.45, while the Nifty gained 0.46% to close at 25,144.30. Broader markets outperformed, with the mid- and small-cap indices registering gains of around 2–3%.

Key Market Drivers

Sentiment was supported by festive optimism, sustained foreign institutional investor (FII) buying, easing crude oil prices and appreciation in the Indian rupee. However, gains remained moderate as domestic inflation rose to 6.09%, breaching the RBI's upper tolerance limit. Rising global bond yields and geopolitical uncertainties also kept investors cautious.

Key Events to Watch

With the Q2 FY27 earnings season entering its final leg, investors will increasingly focus on macroeconomic developments and global cues. Movements in crude oil, the dollar, US Treasury yields and FII flows will remain important determinants of market direction.

The domestic economic calendar will be busy, with October WPI inflation and merchandise trade data scheduled for Monday, 16 November. WPI inflation stood at 11.39% in September, while India's merchandise trade deficit was US$30.21 billion. M3 money supply data on 18 November and October industrial production figures on 20 November will provide further insights into liquidity conditions and economic activity.

Globally, investors will track US retail sales, FOMC meeting minutes and US jobless claims for cues on economic growth and the future monetary policy trajectory.

Technical Outlook

Nifty: The Nifty closed at 25,144.30 after retreating from its weekly high of 25,299.35. Going ahead, the ability to sustain above the 24,800–25,000 zone will remain crucial to preserving the broader positive structure amid ongoing consolidation. On the upside, a decisive move above 25,500 could pave the way for a further rally towards the 25,750–25,900 zone.

Bank Nifty: The banking index extended its outperformance, gaining around 4% during the week and moving closer to its record high. After the recent sharp up move, the index may witness some consolidation around current levels, which would be a healthy development before the next potential leg of the rally. A sustained breakout above its previous record high of 61,764.85 could open the door for a move towards 63,000. On the downside, the 58,600–59,700 zone is expected to provide a strong cushion during any corrective phase.

Broader Indices: Mid- and small-cap indices outperformed the frontline benchmarks during the week. However, mixed market breadth indicates that the recent up move remains selective rather than broad-based. Sustained improvement in market participation will be important to validate the durability of the ongoing recovery.

Strategy Ahead

We maintain a positive outlook on the market, although intermittent volatility cannot be ruled out given geopolitical uncertainties and their potential impact on crude oil prices. Participants should avoid chasing sharp rallies and instead adopt a staggered approach, focusing on fundamentally strong companies with resilient earnings, healthy balance sheets and reasonable valuations.

Among sectors and themes, we believe PSU banking, capital markets, realty and infrastructure are well placed to outperform in the near term. Traders should align their positions with the prevailing momentum while remaining selective in stock and sector allocation.

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