Daily Market Wrap: Indices Retreat After Record Rally
Indian Stock Market 16 May paused their two-day rally on Friday, May 16, 2025, as profit-booking emerged in heavyweight stocks. The Sensex slipped 200.15 points (0.24%) to close at 82,330.59, while the Nifty 50 dipped 42.30 points (0.17%) to settle at 25,019.80. The decline was led by Bharti Airtel (-2.85%) and Infosys (-1.2%), which collectively wiped out 85 points from the Nifty.
Despite the day’s muted performance, broader markets surged, with the Nifty Midcap 150 rising 0.86% and the Nifty Smallcap 250 jumping 1.53%, reflecting continued retail optimism.
Weekly Highlights: Nifty, Sensex Post Best Closes Since September 2025
The benchmarks capped off a stellar week, fueled by easing global trade tensions and robust institutional inflows:
- Nifty 50: Gained 4.21% this week, closing at its highest level since September 30, 2025.
- Sensex: Rose 3.62%, marking its best weekly close since September 23, 2025.
Sectors like defence, realty, and auto drove the rally, while FIIs pumped in ₹5,392 crore on May 15 alone.
Sectoral Performance: Defence Shines, IT Drags
- Defence & PSUs: Cochin Shipyard (+12.33%), Mazagon Dock (+9.87%), and Garden Reach Shipbuilders (+9.87%) surged on strong order books and government spending.
- IT Under Pressure: The Nifty IT Index fell 0.84% as global demand concerns weighed.
- Auto & Realty: Rate-sensitive sectors advanced on hopes of RBI rate cuts, with Tata Motors and DLF leading gains.
Institutional Activity: FIIs Dominate, DIIs Trim Exposure
- FIIs: Net buyers for the fifth straight week, injecting ₹5,392.94 crore (May 15).
- DIIs: Turned net sellers, offloading ₹1,668.47 crore (May 15) amid valuation concerns.
Top Stock Movers
Gainers (NSE):
- Titagarh Rail Systems (+12.83%)
- IRFC (+6.43%)
- Bharat Electronics (+3.5%) – Top Sensex contributor.
Losers (NSE):
- Bharti Airtel (-2.85%) – Biggest Nifty drag.
- Infosys (-1.2%)
- Divis Labs (-0.69%).
Expert Insights
- Vinod Nair, Geojit Financial Services:
“Profit-booking was expected after the sharp rally, but sectors like defence and renewables continue to attract buyers. Stable macros and FII inflows signal resilience.” - Shrikant Chouhan, Kotak Securities:
“The 4% weekly jump in Nifty reflects India’s outperformance. With inflation at 3.2%, RBI rate cuts could fuel a fresh leg of growth.”
Currency & Global Factors
- Rupee: Edged 3 paise stronger to 85.52/USD, supported by FII inflows.
- Global Cues: Easing US-China trade tensions and softer crude prices (~$78/barrel) boosted risk appetite.
Corporate Earnings Spotlight
- IndusInd Bank: Analysts expect a ₹3,000 crore accounting hit in Q4 results.
- Hyundai Motor India, BHEL, and Delhivery reported mixed Q4 results post-market hours.
Looking Ahead
While benchmarks may consolidate near record highs, sectors like defence, renewables, and capital goods are poised to lead. Investors will monitor:
- Monsoon Progress: Critical for rural demand and inflation.
- Global Trade Developments: US-China tariff negotiations.
- Q4 Earnings: Focus on banking and IT sectors.
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