Indian markets decline for third week, signs of stability emerging

The Indian stock market continued to struggle last week, marking the third consecutive week of declines for the BSE and Nifty indices. However, there are signs of improvement as the rate of decline has slowed, suggesting a potential shift towards stability. Despite foreign institutional investors (FIIs) continuing to sell off, the reduction in the level of decline indicates a possible positive trend for the market. Additionally, the satisfactory performance of Indian companies in the second quarter has weakened selling pressures.

Technically, the Nifty index support level was noted at 24,900 points, which remains fragile. If improvements occur this week, there could be a bullish outlook for the market. Given the international conditions, the current market status is not favorable, and investors should proceed cautiously. The ongoing uncertainty is further highlighted by domestic institutional investors (DIIs) purchasing shares worth Rs 16,384.00 crore, compared to FIIs’ sell-off of Rs 21,823.34 crore last week.

For the week ending Friday, the BSE index fell by 156.61 points (0.19%), closing at 81,224.75 points, while the NSE Nifty index decreased by 110.20 points (0.44%), settling at 24,854.05 points.

In the bullion market, uncertainty drove investors towards gold and silver. International tensions contributed to rising prices in these commodities. In Jaipur’s jewelry market, 24-carat gold prices rose by Rs 1,850 per 10 grams, reaching Rs 80,000, up from Rs 78,150 the previous Saturday. Silver prices increased by Rs 4,950 per kilogram, rising to Rs 98,500 from Rs 93,550.

Due to the festive season and investor demand, traders expect further improvements in gold and silver prices, predicting silver might touch Rs 1 lakh per kilogram next week.

Regarding the market outlook for this week, traders anticipate ongoing profit-taking. The recent IPO by Hyundai Motors, aiming to raise Rs 32,000 crore, did not achieve expected success, despite receiving 2.37 times support. It struggled to meet targets outside of the qualified institutional buyers (QIBs) and employees’ categories. Hyundai shares will be listed on October 22, and current grey market prices suggest they may open lower than the IPO maximum price of Rs 1,960, which could put additional pressure on the stock market.

Traders believe that risks remain for new investments, advising patience. However, some see the current situation as an opportunity, identifying stocks like Paytm, Suraj Estate Developers, Tech Mahindra, and Tata Technologies for potential investment. Investors in new IPOs will have the opportunity to apply for four companies on the main board and six through the MSME platform this week.