Will the Indian Stock Market Continue to Rise Despite New Covid Concerns?

Mumbai, May 21 (NationPress) The Indian benchmark indices commenced the day on a positive note on Wednesday, buoyed by mixed global signals. Notable buying activity was recorded in the pharmaceutical, automobile, public sector banking, and financial services sectors during the early trading session.

At approximately 9:35 AM, the Sensex showed an increase of 296.53 points or 0.37%, reaching 81,482.97, while the Nifty index climbed by 88.90 points or 0.36% to hit 24,772.80.

The Nifty Bank index rose by 98.55 points or 0.18%, settling at 54,975.90. In contrast, the Nifty Midcap 100 index decreased by 154.10 points or 0.27%, standing at 56,028.55. Similarly, the Nifty Smallcap 100 index fell by 63.65 points or 0.36%, reaching 17,419.35.

Market analysts observed that Indian equity benchmarks faced a significant downturn on Tuesday due to rising COVID-19 cases in Southeast Asia, particularly in countries like Singapore and Hong Kong.

“From a technical standpoint, the Nifty closed below its 5-day EMA for the first time since May 8, 2025, indicating a potential shift towards profit-taking. Support levels are identified at 24,494 and 24,378, while expected resistance lies in the 24,800-24,900 range,” stated Devarsh Vakil, Head of Prime Research at HDFC Securities.

In the absence of strong global indicators, Indian markets are anticipated to continue from their previous session's performance, he added.

In the Sensex roster, notable gainers included Sun Pharma, HDFC Bank, Tech Mahindra, TCS, Nestle India, Maruti Suzuki, ICICI Bank, UltraTech Cement, and Hindustan Unilever. Conversely, Eternal, Kotak Mahindra Bank, IndusInd Bank, and NTPC were the main decliners.

In Asian markets, countries like China, Hong Kong, Bangkok, Seoul, and Jakarta were trading positively, while only Japan was in the negative territory.

In the last trading session, the Dow Jones in the US closed at 42,677.24, down by 114.83 points or 0.27%. The S&P 500 concluded with a loss of 23.14 points or 0.39%, finishing at 5,940.46. The Nasdaq closed at 19,142.71, down by 72.75 points or 0.38%.

The recent surge in uncertainty and risk is impacting the market unexpectedly. The foreign institutional investor (FII) sell-off figure of Rs 10,016 crore yesterday marks a significant shift from their aggressive purchasing in May, and if this trend continues, it could have ramifications for the market, according to experts.

“The downgrade of the US sovereign debt's credit rating and the subsequent increase in US bond yields, along with rising COVID cases in certain Indian areas and rumors of a potential Israeli attack on Iran, are contributing to this unexpected change in FII behavior,” they noted.

As per provisional data from the NSE, foreign institutional investors sold Indian equities worth Rs 10,016.10 crore on May 20, while domestic institutional investors were net buyers amounting to Rs 6,738.39 crore.