Indian benchmark equity indices continued their winning streak for the fifth consecutive session, ending the week with the highest gain in over four years. This rally was fueled by bargain hunting and foreign portfolio investors reversing their selling trend in the past few days. The Indian rupee also witnessed a significant uptick, ending the week 100 paise stronger against the US dollar, marking its best performance in more than two years.
The week’s gains in the stock markets were driven by realty stocks, PSU stocks, and financials. The BSE Sensex closed at 76,905.51, up 0.73%, while the NSE Nifty 50 ended at 23,350.40, a gain of 0.69%. Both indices managed to surge over 4% throughout the week.
The broader markets outperformed the benchmarks, with the Nifty Midcap Select rising by 1.25% to 11,507.00 and Nifty Smallcap indices gaining over 2%.
“The anticipated decrease in risk-free rates, along with the weakening dollar index, is facilitating fund inflows back to Emerging Markets. Foreign Institutional Investors, whose selling activity has been tapering off, are now turning into net buyers, encouraged by the dovish signals from the US Fed,” said Vinod Nair, Head of Research at Geojit Financial Services.
On Friday, FPIs bought equities worth ₹7,470.36 crore, while DIIs offloaded shares worth ₹3,202.26 crore. The Nifty Bank rose by 1.06%, with other sectoral gainers including PSU Banks, Media, Oil & Gas, and Healthcare. Among individual stocks, SBI Life emerged as the top gainer on the NSE, surging by 3.43%.
BSE’s total market capitalization climbed to ₹40,924,873.00 crore by March 20, with the market cap of the top 10 companies reaching ₹9,175,059.43 crore.
“The investors continued with short covering, helping Sensex breach the 77k mark in intra-day trades. Additionally, investors might be squaring off their positions ahead of next week’s monthly F&O expiry,” noted Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd.
In the currency market, the Rupee recorded its largest gain in over a month on Friday, strengthening by nearly 40 paise as FPI inflows propelled the domestic equity markets higher. The Indian unit closed at 85.9725 per USD against the previous close of 86.37.
Arvind Kanagasabai, Executive Vice President at Tamilnad Mercantile Bank, stated, “The Rupee could strengthen further to 85.84/85 levels, then again start weakening. It will move up and down hereafter, instead of moving only one-way like what happened earlier. Over a period of one year, the Rupee should go back to 83.50 to 84 levels as there could be a rally in the Indian markets.”
