India's Stock Market Sinks to Fifth Week of Losses Amid Rising Oil Prices and Global Bond Yields
The Indian stock market has ended its fifth consecutive week of losses due to increased crude oil prices and rising global bond yields, which have led to concerns over US inflation.
Brent crude oil prices surged by nearly 8% during the week, closing at $104 per barrel. This hike in oil prices is raising concerns about imported inflation, the current account deficit, corporate margins, and the rupee.
Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, said that geopolitical uncertainties remain elevated due to tensions between the US and Iran and broader developments in the Middle East. The movement of crude oil prices and global market cues will likely remain important factors for the domestic market in the coming week.
The Nifty 50 declined by nearly 2% to close at 23,398, while the Bank Nifty decreased by 1.33% during the week. Sectoral performance remained under pressure, with Cement, Metals, Technology, and Realty witnessing profit booking and declining by around 3-5%. Dongre said that from a technical perspective, the Nifty has entered an overbought zone following its sharp rally, increasing the possibility of profit booking and sideways consolidation.
The Bank Nifty also remained under selling pressure during the week and is currently trading near its 200-day EMA around 56,600. Dongre said that if this level holds during the coming week, the index could retain its constructive medium-term structure.