Market Wrap

Indian equities wrapped up a turbulent and decisively weak week, with the Nifty tumbling over 2.5% and slipping below the crucial 25,050 level amid relentless selling pressure.

The week kicked off with a gap-down opening and sentiment never fully recovered. A brief mid-week rebound offered some hope, but it proved short-lived as fresh selling resurfaced on Friday. Persistent FII outflows, negative headlines surrounding select large corporate groups, and rising uncertainty ahead of key domestic events weighed heavily on investor confidence.

The damage was widespread across sectors. All sectoral indices ended in the red, with realty stocks emerging as the worst hit, sliding nearly 3% as traders booked profits and cut risk exposure. Broader participation remained weak, reflecting caution across the market spectrum.

Volatility surged meaningfully during the week. India VIX jumped 6.31% to 14.19, signalling elevated nervousness as traders brace for a heavy event calendar. Global cues offered little comfort. While US markets closed firm, European indices traded lower and Asian markets showed only marginal gains, reflecting a broader tone of global caution that failed to lift domestic sentiment.

What's Ahead

Markets now head into a high-impact, event-heavy stretch where sentiment is likely to swing sharply with every headline. The January F&O expiry, the Economic Survey, and the Union Budget are lined up within days, keeping traders on edge. With volatility already elevated and key indices hovering near important support zones, positioning is expected to remain light and reactive. FII flows, rupee movement, and global cues will continue to dictate near-term direction, especially as investors avoid aggressive bets ahead of policy clarity.

Technically, most frontline indices are approaching oversold territory, which raises the possibility of sharp pullback rallies; however, sustainability of any bounce will depend on whether support levels hold and banking stocks stabilize. A decisive move below supports could trigger another round of selling, while a recovery above resistance bands may invite short covering. Until Budget signals emerge, markets are likely to remain choppy, volatile, and highly news-driven rather than trend-driven.

Market Snapshots

Institiutional Activity

Sectoral Performance

Technical Outlook

Nifty 50

Nifty 50 slipped 241.25 points (-0.95%) to close at 25,048.65 after failing to hold early gains, as heavy selling in index heavyweights and financials dragged the benchmark lower amid FII outflows, rupee weakness, and pre-Budget caution. The index traded in a wide intraday range (25,025–25,348) but remained under pressure through the session, reflecting fragile sentiment and weak breadth (13 advances vs 37 declines). Technically, RSI has slipped toward the 30 mark, signalling rising selling pressure and approaching oversold conditions. Immediate supports are placed at 24,710 and 24,498, while any pullback is likely to face resistance at 25,396 and 25,609.

Bank Nifty

Bank Nifty declined 727 points (-1.23%) to 58,473.10, breaching a key support zone as selling intensified across PSU and private banks, with breadth extremely weak (1 advance vs 13 declines). After a brief rebound in the previous session, the index failed to sustain higher levels and reversed sharply in a volatile trade (58,346–59,400 range). Momentum has weakened materially with RSI drifting toward the 40 mark, indicating loss of strength. Near-term supports are seen at 57,995 and 57,699, while resistances are placed at 58,951 and 59,247.

Nifty Financial Services

The Nifty Financial Services index fell 328.60 points (-1.21%) to 26,821.35 amid broad-based pressure across lenders, insurers, and NBFCs, with just 1 stock advancing against 19 declines. Heavyweights such as Jio Financial, Axis Bank, and SBI weighed on the index, reflecting sustained risk-off sentiment in the financial pack. Technically, the structure has weakened after repeated failures to hold higher levels, and the index now approaches important support bands at 26,552 and 26,367. On the upside, resistance is likely at 27,150 and 27,335.

Sensex

Sensex dropped 769.67 points (-0.94%) to close at 81,537.70 as losses in heavyweights overshadowed selective buying in IT and FMCG names, with market breadth negative (7 advances vs 23 declines). The index remained under pressure throughout the session, reflecting caution ahead of key domestic triggers and persistent selling in large caps. Technically, the index is nearing a crucial support area at 80,540 and 79,916, while any recovery attempt may encounter resistance at 82,557 and 83,181.