Indian equity markets may have snapped their three-day winning streak on Friday, but the broader technical outlook remains constructive, according to market experts. With the Nifty 50 holding above the crucial 25,000 mark and key moving averages, analysts believe investors could consider buying on dips, provided important support levels remain intact.
The Sensex declined 318.56 points, or 0.39%, to settle at 81,592.45 on Friday. It fell as much as 622.26 points, or 0.75%, to an intraday low of 81,288.75. The Nifty 50 closed 155.05 points, or 0.61%, lower at 25,144.30. The decline snapped a three-session rally and marked the first major fall for both benchmark indices this month.
The sell-off followed the release of October retail inflation data, which showed consumer price inflation rising to 6.09% from 5.54% in September, breaching the Reserve Bank of India's upper tolerance threshold of 6%. The reading revived concerns about a potentially tighter monetary policy stance and a possible rate hike at the RBI's December meeting.
Dr Ravi Singh, Chief Research Officer at Master Capital Services, said Indian equity benchmarks extended their gains for a third consecutive week, despite a holiday-truncated trading schedule and profit-booking towards the end of the week.
The Nifty 50 gained 0.63% during the week, while the Sensex advanced 0.73%. Singh attributed the broader recovery to sustained foreign capital inflows, driven by global portfolio reallocations from expensive developed-market AI trades towards emerging markets such as India. Festive optimism and strong credit growth data also supported sentiment earlier in the week.