Nifty Snaps Two-Day Losing Streak As Benchmark Index Closes Above 22,500 Mark

Indian stock market investors breathed a sigh of relief after the markets resumed trade after a truncated week on account of Holi. While both the benchmark indices closed in the green on March 17, the Nifty 50 managed to end its three-day losing streak.

The Sensex closed higher at 74,169.95 levels, up by 341.04 points or 0.46 per cent on March 17. The Nifty 50 closed at 22,508.75 levels up by 111.55 points or 0.5 per cent. In the past two sessions the 50-share benchmark index fell 0.44 per cent to 22,397.2 levels on March 13 from 22,497.9 levels on March 10.

Among the 50 constituents of the benchmark Nifty, as many as 33 stocks advanced and 17 stocks declined on March 17. The benchmark index closed higher as two of its top constituents in terms of weightage closed in the green zone.

Top Nifty Gainers And Losers

Index heavyweight HDFC Bank Ltd closed higher by 0.23 per cent at Rs 1,710.5 apiece on the NSE. Other heavyweights such as ICICI Bank Ltd also closed higher by 1.49 per cent at Rs 1,268.65 apiece.

Dr. Reddy's Laboratories Ltd emerged as the top-gainer as it closed at Rs 1,151.5 apiece up by 3.93 per cent. Earlier today the stock hit an intraday high at Rs 1154.1 apiece after gaining over 4 per cent on the NSE. Other major gainers among Nifty 50 constituents included SBI Life Insurance Company Ltd and Bajaj Finserv Ltd which closed 3.89 per cent and 3.74 per cent higher respectively. Tata Group company Trent Ltd and Axis Bank Ltd also closed higher by as much as 2.54 per cent.

Shares of IT services major Wipro Ltd closed lower by 1.53 per cent at Rs 259.95 apiece on the NSE. Earlier today the stock hit an intraday low of 1.93 per cent as it traded at Rs 258.9 apiece on the NSE. BPCL, Hero MotoCorp, ITC and Nestle India also emerged as top drags as they closed lower by as much as 1.13 per cent.

How Did Nifty Snap Its Losing Streak

Pawan Parakh, Fund Manager, Geojit Financial Services told Outlook Money that benchmark Nifty stocks managed to gain in trade on March 17 amid growing fatigue regarding US President Donald Trump’s reciprocal tariff policies and their postponement. He added that investors seem to have begun to understand that the impact of tariffs is likely to be negative for the US economy as well. He added that this has led to a calm in selloffs.

“There has been a growing fatigue with respect to Trump’s tariff policies as the US has already reversed their tariff decisions multiple times in the last 40 days. Most investors understand that tariffs are likely to negatively impact the US economy as well. In this backdrop, global markets including India have calmed down a bit. Specifically, for Indian markets, we have already seen a sharp correction in the broader markets, which has made the valuations far more palatable,” Parakh said.

Notably, the selling of equities by Foreign Institutional Investors has also declined consistently in the last three sessions. On March 11, FIIs net sold equities worth Rs 2,823.76 crore, on March 12 the sale dropped to Rs 1,627.61 crore and on March 17 equities worth Rs 792.9 crore were net sold by FIIs.

Broader Market Action

Broader market indices posted a short recovery on March 17 mirroring the movement of benchmark indices. The Nifty MidCap 100 closed higher by 0.7 per cent at 48,461.8 levels and the Nifty SmallCap 100 closed higher by 0.48 per cent at 14,968.4 levels. While the two indices managed to bounce back in today’s session, they are still trading as much as 24 per cent below their all-time highs.

Notably, if an index trades more than 20 per cent below its recent peak, it is said to be in bear territory. The India VIX index which is a measure of how much the market is expected to fluctuate over the next 30 days, closed higher at 13.42 levels up by 0.14 points or 1.02 per cent. An increase in the index is generally seen as a sign of higher volatility.

Amid the volatility, Parakh said that some of the pressures which have led to the slowdown seen in the Indian markets so far have eased or are changing for the better. He added that macroeconomic factors indicate a gradual recovery ahead, thus investors can consider gradually increasing their allocation towards equities.

“Slowdown in Indian markets was led by domestic factors like muted government spending, RBI concerns on loan growth and tight banking liquidity. All of these factors are changing for the better. Some of the lead indicators like growth in electricity demand, e-way bill generation and tax collection amongst others indicate that a gradual recovery is already underway. In this background, it makes a lot of sense to increase allocation towards equities,” Parakh said.