Market outlook for the week (28-Apr to 02-May, 2025)

28 Apr 2025 , 07:37 AM

SECTORAL STORY FOR THE WEEK TO APRIL 25, 2025

The week to April 25, 2025 saw Nifty and Sensex showing gains of +0.79% and +0.84% respectively. During the week, FPIs were net buyers in Indian equities to the tune of $2,040 Million; amidst growing risk-on optimism. Here are 20 key sectors for the week.

Sectoral Index	Weekly Returns	Index (25-Apr)	Index (18-Apr)
Nifty IT	6.56%	35,562.25	33,372.35
Nifty Capital Markets	4.83%	3,744.55	3,572.00
Nifty India Digital	3.02%	8,352.45	8,107.50
Nifty Automobiles	2.91%	21,994.50	21,373.10
Nifty Realty	1.69%	859.35	845.10
Nifty Metals	1.10%	8,569.75	8,476.50
Nifty Oil & Gas	0.90%	10,788.65	10,692.20
Nifty Healthcare	0.87%	13,829.80	13,711.05
Nifty Mobility	0.78%	18,986.25	18,839.95
Nifty Banks	0.69%	54,664.05	54,290.20
Nifty Chemicals	0.65%	29,031.18	28,843.87
Nifty India Defence	0.57%	6,640.65	6,603.05
Nifty Non-Banks	0.32%	27,510.25	27,423.55
Nifty MNC	0.23%	26,764.10	26,703.95
Nifty PSU Banks	0.20%	6,535.50	6,522.50
Nifty Private Banks	0.18%	27,198.55	27,149.75
Nifty FMCG	-0.25%	56,532.35	56,674.20
Nifty CPSE	-0.37%	6,214.35	6,237.40
Nifty Infrastructure	-0.50%	8,589.30	8,632.80
Nifty Consumer Durables	-0.80%	36,941.50	37,240.30

Data Source: NSE

Out of 20 sectoral indices 16 sectors gave positive returns, while 4 sectors gave negative returns. IT and Digital were the big gainers on value buying at lower levels. Capital Markets and automobiles also gained on lower rate hopes. Private banking results were in line with expectations, but the tepid performance is factoring in the likely pressure on net interest margins (NIMs) due to falling repo rates. Consumer facing stocks were under pressure.

Overall, average returns of the 20 sectors stood at 1.18%. The top 10 sectors gave an average return of 2.33%, while the bottom 10 sectors delivered average returns of 0.02%. Only 3 sectors gained more than 3% for the week, with 14 out of the 20 sectors showing returns of less than 1% for the week. Consumer facing stocks faced pressure after Q4 results of HUL and Nestle India revealed signs of slowing urban consumption and EBITDA pressures.

WEEK THAT WAS; THE GOOD, THE BAD AND THE UGLY

The one factor that boosted the markets in the week was the tapering of global risk with Trump being less aggressive in his macroeconomic approach. The Indian rupee stayed strong at ₹85.35/$ due to the dollar index staying subdued at around 99.5 levels. The big positive in the week was the robust FPI flows of $2,040 Million, as investors again turned risk-on. MPC minutes for the week also gave a clear hint of another rate cut in June.

The big risk factor in the week was the terrorist attack at Pahalgam, which led to the sharp correction on Friday. Geopolitical risk was absent in last few months, but that seems to be back as relations with neighbours have not been at its best. FMCG showed pressure in its Q4 numbers and that has also kept the markets under pressure. Ather Energy markets revival of the IPO mainboard after 75 days, but IPO valuations are being deeply discounted.

STOCK MARKET TRIGGERS FOR COMING WEEK TO MAY 02, 2025

Here are key triggers that could influence stock markets next week.

• With the recent terror attacks in Pahalgam in Kashmir, the issue of political risk is going to dominate the Indian market debate for the week. Geopolitical risk is never good for markets and that will be an overhang in the coming week..
• The MOSPI will announce the March IIP on 28-April and the full year FY25 IIP, with the focus being largely on the manufacturing IIP. Markets will be looking closely at the break-up of mining, manufacturing, and electricity to identify key pain points.
• Two major data points are expected from US markets next week. The first estimate of Q1 GDP and the March PCE inflation will be announced. It will go a long way in driving the direction of FPI flows into Indian debt, as it decides the benchmark yield spreads.
• The subscription to the Ather Energy from retail and HNI/NII will hold the key to next week performance. While anchor interest has been high, the non-institutional response will hold the key to the timetable for other IPOs.
• Key global data points. Trade deficit, JOLTS, Atlanta Fed GDP, Q1 GDP, Core PCE, Pending Home Sales, Initial Jobless Claims, PMI (US). ECB Bulletin, GDP, PMI, CPI (EU); BOJ Policy Statement (Japan); Composite PMI (China); and MPC Speak & HPI (UK).

What does this mean for Nifty and Sensex in the coming week to May 02, 2025.

PARTING THOUGHTS ON MARKET INDEX LEVELS

VIX bounced from above 15.47 levels to 17.16, amidst geopolitical risk. Markets would be keen to see if VIX tapers lower to 12 levels, where “Buy on Dips” could be a strategy.

• Nifty closed the week at 24,039 Spot. Nifty has immediate support at 23,803 and major support at 23,285. Immediate resistance is at 24,321 and later at 24,838. Nifty stays a long play till it decisively breaks below 23,954 with volumes. Shorts only after that.
• Sensex closed the week at 79,213 Spot. Sensex has immediate support at 78,502 and major support at 76,977. Immediate resistance is at 80,027 and later at 81,552. Sensex is a long play, till it breaks below 78,879 with volumes. Shorts have to wait till then.

More than the data flows, the next week will be about how India reacts to the Pahalgam situation. Markets may continue to be jittery till then. The big data point to watch now will be the Q4 and FY25 GDP, which will be published towards the end of May 2025!