Mumbai, August 8: The Indian stock market has recorded gains for the second consecutive week, bolstered by a sharp decline in crude oil prices and better-than-expected corporate results for the first quarter of the fiscal year 2026-27. Although profit booking was observed on the last trading day of the week, major indices closed positively on a weekly basis.
During the week, the Nifty index strengthened by 0.77 percent, but saw a decline of 0.27 percent on Friday, closing at 24,570. Meanwhile, the Sensex fell by 455 points, or 0.58 percent, ending at 78,499. Despite this, the Sensex achieved a weekly gain of 0.52 percent.
The broader market outperformed the main indices. The Nifty Midcap 100 index recorded a rise of 0.87 percent, while the Nifty Smallcap 100 index surged by 2.73 percent. This indicates a growing interest among investors in mid-cap and small-cap companies, alongside large-cap stocks.
Market experts noted that small-cap stocks performed exceptionally well. Strong quarterly results and positive developments related to these companies have kept investor interest high in this category. Conversely, there was significant buying in PSU banking stocks due to their strong fundamentals and financial performance.
The metal sector benefited from robust domestic demand and improved economic growth prospects. Additionally, shares of automobile companies saw an uptick, as the market anticipates strong vehicle demand during the upcoming festive season.
The week began with some volatility due to the implementation of a new closing auction session (CAS) in the futures and options (F&O) segment. However, stability returned to the market as investors and participants adapted to the new arrangement.
Analysts believe that the substantial drop in crude oil prices provided significant support to market sentiment. Lower oil prices have alleviated concerns regarding inflation and import costs for India, improving the economic outlook and boosting investor confidence.
Globally, the market also received support. Following relatively soft labor market data from the U.S., the likelihood of the Federal Reserve raising interest rates in the near future diminished. This led to a softening of both U.S. bond yields and the dollar, enhancing the investment environment for emerging markets, particularly India.
On the domestic front, the Reserve Bank of India (RBI) has also bolstered investor confidence. The central bank made no changes to its monetary policy, slightly raised its GDP growth forecast, and lowered its inflation estimate, signaling that the Indian economy remains in a strong position.
Moreover, the ongoing quarterly results season has further strengthened the market. Most companies have reported results that exceeded market expectations, leading to increased buying across various sectors and reinforcing investor confidence.
Looking ahead, the market will focus on U.S. employment and inflation data, which could provide insights into the Federal Reserve’s upcoming policies. Domestically, the Consumer Price Index (CPI), Wholesale Price Index (WPI), and bank credit growth figures will be crucial for understanding the state of the Indian economy and the inflation trajectory.
Experts believe that if crude oil prices remain stable and companies continue to report strong results, the Indian stock market could receive further support in the coming weeks.
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