Sensex ends flat as financial stocks offset crude and bond yield concerns

The BSE Sensex ended at 77,540.83, up 3.11 points, or 0.004%, while the Nifty 50 settled at 24,252.00, up just 20 points at the closing bell.

In Short

• Financial stocks like Kotak Mahindra Bank gained, offsetting losses
• Crude oil and global bond yields kept investor sentiment cautious
• Domestic economy showed resilience despite global uncertainties

Indian equity markets ended largely flat on Friday, with rising global bond yields and elevated crude oil prices keeping investors cautious. The benchmark indices struggled for direction through the session, with gains in financial stocks helping offset weakness across several other sectors.

The BSE Sensex ended at 77,540.83, up 3.11 points, or 0.004%, while the Nifty 50 settled at 24,252.00, up just 20 points at the closing bell.

The Sensex opened at 77,701.07 and moved between a high of 77,725.67 and a low of 77,445.86 during the session. The broader market remained relatively resilient, with the Nifty Midcap 50 and Nifty Midcap 100 rising 0.11% and 0.10%, respectively, while the Nifty Smallcap 100 gained 0.69%.

Financial stocks provided some support to the benchmarks. Among the 30 Sensex constituents, Kotak Mahindra Bank was the top gainer, rising 1.52%, followed by BEL, which gained 1.08%. Tata Steel, SBI, HDFC Bank and ICICI Bank also ended higher.

Vinod Nair, Head of Research at Geojit Investments Limited, said the market was being supported by value buying in financial heavyweights, helped by robust credit growth and attractive valuations following the recent correction.

"Strong value buying in financial heavyweights fuelled by robust credit growth and attractive valuations after the recent correction is helping the market trade flat," Nair said.

Kotak Mahindra Bank rose 1.52%, while BEL gained 1.17% and Tata Steel advanced 0.60%. SBI, HDFC Bank and ICICI Bank also closed in positive territory.

The gains were capped by weakness in several heavyweight stocks. Trent was the biggest Sensex loser, falling 1.53%, followed by Maruti Suzuki, which declined 1.51%. Indigo, HCL Technologies, Hindustan Unilever and Infosys were also among the major laggards.

The Nifty IT index fell 0.46%, while Nifty FMCG declined 0.74%. Nifty Auto, Nifty Media, Nifty Pharma and Nifty Chemicals also ended lower.

Nair said elevated global bond yields remained a key concern for investors. "The elevated global bond yields continue to cause worry in the market," he said, adding that the recent US Treasury move to ease bond yields had failed to provide lasting comfort as crude prices remained high and inflation concerns persisted.

CRUDE OIL, BOND YIELDS KEEP SENTIMENT CAUTIOUS

Crude oil remained elevated, with Brent crude around $93.52 a barrel and WTI crude at $86.58. Higher oil prices continue to raise concerns over inflation and input costs, particularly for oil-importing economies such as India.

Nair also pointed to domestic bond yields as a source of pressure. The RBI's hawkish meeting minutes have pushed India's 10-year government bond yield to a two-month high, he said, amid concerns over local inflation and tighter liquidity.

Despite these headwinds, domestic economic resilience offered some support to equities. Nair said recent services PMI data showed that the domestic economy remained resilient despite an uncertain global environment.

Among sectoral indices, Nifty Metal was the biggest gainer, rising 0.86%, while Nifty Private Bank gained 0.51% and Nifty Financial Services 25/50 advanced 0.23%. Nifty Realty rose 0.40% and Nifty PSU Bank added 0.04%.

On the other hand, Nifty Chemicals fell 0.60%, Nifty FMCG declined 0.74%, Nifty Media dropped 0.54% and Nifty Auto slipped 0.60%.

Gold also remained in focus, hitting a near three-month high on Friday and heading for a third straight weekly gain. The precious metal was supported by a weaker dollar and the US Treasury's surprise mid-week liquidity support announcement.

Nair said stable metal prices were providing "crucial support" to commodity stocks, even as investors remained cautious about the broader market outlook.

The broader market remained mixed. Nifty 100 gained 0.02%, Nifty 200 rose 0.03% and Nifty 500 added 0.07%. The Nifty Midcap 50 and Nifty Midcap 100 gained 0.11% and 0.10%, respectively, while the Nifty Smallcap 100 climbed 0.69%.

Overall, the market ended the week on a subdued note, with investors balancing resilient domestic fundamentals against elevated crude prices, bond yields and persistent inflation concerns.

(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)

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