Mumbai, May 30 (IANS): Indian equity benchmarks posted notable losses during the week due to sustained FII selling and a below-normal monsoon forecast that triggered fears of food inflation, with Nifty losing 0.72 per cent during the week and dipping 1.50 per cent on the last trading day to reach 23,547, while Sensex declined 0.85 per cent over the week and closed down 1,092 points or 1.44 per cent at 74,775. Large caps remained under pressure even as the broader market demonstrated meaningful resilience, with midcaps briefly touching an all-time high, and Nifty Midcap100 adding 0.54 per cent while Nifty Smallcap100 gained 1.02 per cent during the week. PSU Banks led on mark-to-market treasury gains from yield compression while autos and metals benefited from crude’s sharp decline, whereas FMCG, healthcare and consumer durables declined as defensive premiums unwound on improving risk appetite, according to an analyst. Cumulative outflows by foreign institutional investors stood at approximately Rs 23,700 crore during the week, with MSCI index rebalancing-related adjustments also triggering substantial institutional selling in the last trading session. Crude oil staged a sharp weekly decline driven by optimism around a potential US-Iran diplomatic breakthrough, but IMD’s below-normal monsoon forecast offset the resultant gains, while the rupee firmed modestly through the week after RBI commentary signalling that the INR remains undervalued.
Market participants said the overall macro backdrop is more constructive than it was a fortnight ago, but confirmation through policy clarity, monsoon normalisation and geopolitical de-escalation is needed before large cap conviction builds into the next meaningful leg higher. On the technical front, Nifty 50 is expected to see the 24,000–24,100 region as a strong resistance zone while the 23,300–23,000 region remains a crucial support area, and in Bank Nifty, immediate resistance is placed around the 54,600–54,800 zone with the 54,200–54,000 region continuing to act as an immediate support zone. Investors remain keen on cues from the upcoming RBI monetary policy decision, India’s GDP data release, Purchasing Managers’ Index and the Index of Industrial Production data.