Will Nifty and Sensex Continue Their Surge Amid Hopes of a US-India Trade Deal?
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Synopsis
The Indian equity markets witnessed a robust week, with Nifty and Sensex climbing over 2 percent, fueled by positive developments in US-India trade negotiations. As investors eye crucial economic indicators, the outlook remains optimistic for the upcoming Diwali week.
Key Takeaways
- Nifty and Sensex rose over 2% this week.
- Positive developments in India–US trade negotiations boosted market sentiment.
- Bank Nifty achieved a new milestone, driven by strong banking stock performance.
- Profit booking was evident in media and metal stocks.
- Investors should remain cautious in the upcoming Diwali week.
Mumbai, Oct 18 (NationPress) The Indian equity benchmarks concluded the week firmly in the green, driven by short covering by foreign institutional investors (FIIs) and strong domestic indicators.
Market positivity was enhanced by progress in India–US trade relations, with both nations tentatively agreeing to finalize the initial phase of the agreement by November.
The mood remained optimistic as the Bank Nifty achieved a significant landmark, fueled by robust buying interest in top banking stocks. Investor sentiment was lifted by diminishing worries regarding asset quality in the financial sector and expectations of enhanced volume growth during the festive quarter.
During the week, benchmark indices Nifty and Sensex increased by 2.10 and 2.04 percent, respectively, with the FMCG, pharma, and auto sectors being the primary drivers of this ascent.
Market analysts noted that sectors focused on consumption also experienced growth, alongside a widespread recovery in realty, healthcare, and banking.
However, IT stocks faced pressure due to concerns over global discretionary spending and increasing asset quality issues within the US banking sector.
Profit booking was observed in media and metal stocks, which limited the overall gains of the indices.
The broader market took a pause following a strong performance, with the Nifty Midcap 100 declining by 0.57 percent and the Nifty Small-cap 100 slightly dropping by 0.05 percent, indicating selective profit-taking by investors.
According to analysts from Bajaj Broking Research, "Nifty has formed a significant bullish candle on the weekly chart, showcasing a higher high and higher low, suggesting the continuation of the upward trend. The index broke out of a three-month symmetrical triangle consolidation pattern, reflecting a positive outlook."
They anticipate the index to target 25,900 and subsequently 26,200 levels in the upcoming weeks.
In the upcoming holiday-shortened Diwali week, investors are expected to remain cautious due to the impending release of crucial economic data, including US inflation, employment statistics, and India’s PMI figures.
Investors are also paying close attention to cues from the ongoing earnings season and policy announcements from major global central banks.
Point of View
It is imperative to approach the current market dynamics with a balanced viewpoint. While the surge in Nifty and Sensex reflects positive investor sentiment and favorable trade negotiations, caution is warranted as we await significant economic data and earnings results. Navigating these trends with a focus on transparency and accuracy remains our commitment.
NationPress
18/10/2025
Frequently Asked Questions
What factors contributed to the rise of Nifty and Sensex this week?
The increase was primarily driven by short covering from foreign institutional investors, strong domestic cues, and positive developments in India-US trade relations.
What sectors performed well during the week?
The FMCG, pharma, and auto sectors were major contributors to the rally, along with positive movements in consumption-driven sectors.
What should investors watch for in the upcoming Diwali week?
Investors should focus on key economic data releases, including US inflation and employment figures, as well as signals from the ongoing earnings season.
