Nifty 50: Global banking crisis drove Nifty lower this week

Stock Market This Week

Out of the five trading days, the market closed in the green only on the last two days. Overall, the benchmark indices ended the week lower amid weak global cues. Sensex and Nifty closed 1.94% and 1.8% lower this week. Let us look at how the market shaped up this week.

Nifty 50 Movement This Week

The Indian market started the week on Monday on a negative amid negative global cues - both benchmark indices closed 1.5% lower. Even though Indian analysts' mentioned that they don't expect a ripple effect of the SVB crises on the domestic financial system, bank stocks faced the heat as most banking stocks fell more than 2%.

On Tuesday, the Indian equity market continued to remain under pressure amid domestic inflationary pressure. The top drag for the day were Adani Enterprises and Adani Ports, falling 8% and 4%, respectively. Most sectors closed the day in the red - only Media and Pharma saw the green color. The biggest drop was seen in PSU Bank stocks.

The benchmark indices opened higher on Wednesday and gained over half a percent but turned negative in the second half. Nifty came below the crucial psychological mark of 17,000 as bank indices pulled the market down. Not all was gloomy for investors, as sectors like Metal and Consumer Durables ended in the green - 1.5% and 0.7% higher, respectively.

On Thursday, the market sentiments turned positive after reports suggested that Credit Suisse is borrowing $54 billion from Swiss National Bank. The market closed marginally higher after closing in the red for five consecutive sessions. It was a mixed day for sectors - The metal index fell 2.6%, while pharma, oil & gas, power, FMCG, and realty indices rose 1% each.

The benchmark indices closed higher on Friday. The rally was led by IT, financials, and metal shares. All the sectors ended in the green except for Auto, Pharma, and FMCG. HDFC Twins gained in the last hour after receiving merger approval from NCLT.

Key highlights for the week

Inflation numbers and rate hike: India’s retail inflation eased to 6.4% in February from 6.5% the previous month, but this was no relief to consumers or the RBI. Consumer price inflation has remained above the upper tolerance limit of the central bank, 6%, in 10 of the past 12 months, and another repo rate hike by the monetary policy committee in April is widely expected.

Indian bond yield dip: Indian government bond yields were lower this week as US yields resumed their downward trend and odds of a status quo in the Federal Reserve's policy meeting next week rose. The 10-year benchmark 7.26% 2032 bond yield was at 7.3325% this week.

Currency in circulation increase: This week, finance minister Nirmala Sitharaman said that the currency in circulation has gone up to Rs 31.33 lakh crore in March 2022, from Rs 13 lakh crore in 2014. The currency in circulation, which includes banknotes and coins, to GDP ratio, stood at 13.7% as on March 25, 2022, up from 11.6% as on March 2014. She further added that the mission of the government is to move towards a less cash economy to reduce the generation and circulation of black money and to promote the digital economy.

Government plans more InvITs: As per sources, the government may launch nearly a dozen public infrastructure investment trusts (InvITs) for road projects to offer retail businesses a regular investment opportunity with assured high returns as part of its efforts to monetize the key infrastructure assets. The sources further added that the first in the series is expected to be launched in the next couple of months.

Market this week India: Top Nifty gainers and losers

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