Mumbai, May 10: Indian equity benchmarks ended lower on Friday amid rising geopolitical tensions after reported clashes between Iran and the US near the Strait of Hormuz dampened investor sentiment.
Despite the weakness, market experts believe the broader trend for both the Sensex and Nifty remains positive, although volatility could persist in the near term.
The Nifty declined 0.55 per cent to settle at 24,193, while the Sensex fell 0.67 per cent to close at 77,321.
However, both benchmark indices managed to end the week with gains of more than 0.70 per cent despite sharp intra-day swings.
In the broader market, the Nifty Smallcap 100 rose 0.22 per cent, while the Nifty Midcap 100 slipped 0.15 per cent.
According to market experts, the Sensex continues to show strength from a technical perspective despite Friday’s correction.
“In the near term, immediate downside support is placed in the 54,600–54,200 zone in case selling pressure re-emerges,” an analyst stated.
“On the upside, 56,400 acts as immediate resistance, while 56,800 stands as the next key supply zone,” the analyst added.
Traders are advised to remain cautious and follow disciplined risk management while closely tracking key levels for the next directional move, market experts added.
On the Nifty, market experts said the index ended the week at 24,176.15, gaining 178.60 points or 0.74 per cent on a weekly basis.
“On the upside, resistance levels are placed at 24,500 and 24,600. On the downside, support is seen at 24,000 and 23,800. A breakdown below 23,800 could result in increased selling pressure,” an analyst stated.
“Given the current market structure, traders are advised to remain disciplined and adhere to strict stop-loss strategies amid ongoing volatility,” the analyst added.
Gold, silver seen range-bound for second week amid US-Iran talks
Gold and silver may remain range-bound for a second consecutive week as investors assess developments in US-Iran peace negotiations and global macroeconomic data, analysts said.
Traders will track inflation data from China, Germany, and the United States, along with GDP numbers from the Eurozone and the UK, later this week, they added.
“Gold prices momentum looks consolidative, while silver movement looks positive in the coming week as traders will focus again on the progress on peace talks between the US and Iran to end the war and markets are likely to react accordingly,” Pranav Mer, Vice President, EBG – Commodity & Currency Research, JM Financial Services Ltd, said.
On the Multi Commodity Exchange (MCX), gold futures gained Rs 1,178, or nearly 1 per cent over the past week, to settle at Rs 1.52 lakh per 10 grams. Silver climbed Rs 10,985, 4.4 per cent, to close at Rs 2.61 lakh per kg.
“Gold traded with a positive undertone last week, posting gains of nearly 1 per cent on MCX and closing around Rs 1.52 lakh per 10 grams,” Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, said.
He added that the correction in crude oil prices after easing geopolitical risk premiums also improved sentiment for bullion.
“Lower US Treasury bond yields and a softer dollar index also helped gold remain stable despite volatility across global markets,” Trivedi said.
In the international market, Comex gold futures advanced nearly 2 per cent during the past week to close at USD 4,730.7 per ounce, and silver climbed 5.8 per cent to finish at USD 80.86 per ounce.
“Gold prices traded steady and moved in a consolidation range through most of the week; however, overall momentum remained positive amid a dip in the dollar and reports of progress on a likely peace deal framework to end the US-Iran war,” Pranav Mer said.
Silver also ended with strong gains for the second straight week, supported by renewed buying of copper prices, a weaker US dollar, and signs of supply tightness in the global market, he added.
According to the World Gold Council, the bullion was also supported by continued central bank buying and renewed inflow of funds in the global exchange-traded funds.
However, precious metal prices were range-bound on Friday, as gains were capped by signs of a re-escalation in the conflict after US and Iranian forces clashed in the Persian Gulf, Mer said.
Meanwhile, the United Arab Emirates came under renewed attacks, but President Donald Trump calmed markets, saying “a ceasefire was still holding.” Analysts, investors will watch developments around US President Donald Trump’s expected China visit and the Senate vote on new Federal Reserve Chair nominee Kevin Warsh.
In the domestic market, inflation, trade numbers and rupee movement will also remain crucial for bullion prices for next week. (Agencies)
