Despite volatility, indices extend gains for second-straight week

Indian benchmark indices ended the week with gains of more than 2 per cent from the closing price of historical Friday last week. The BSE Sensex ended the week at 38,822, higher by 2.12 per cent and Nifty settled at 11,512, higher by 2.11 per cent.

Broader markets too ended with handsome gains. Both the BSE Mid cap index and the BSE Small cap index have logged gains of more than a per cent each for the week.

The indices, however, have lost around 0.60 per cent from the Monday closing. The BSE Mid cap index lost almost 2 per cent from Monday closing high and settled at 14,265, while the BSE Small cap index closed down by 1.71 per cent at 13,332.

After logging historical gains in last week, the Indian benchmark indices continued the trend as the week started with investors continuing to cheer the corporate tax cut news. The Monday closing of more than 3 per cent for indices resulted in overall gains of 8 per cent for the indices in just two trading sessions. The gains, however, fizzled out in the next trading sessions due to weak global cues triggered by the impeachment inquiry on US President Donald Trump.

Back home, sentiments got further dampened after research house reports claimed that the gains on account of tax rate cut are already priced in till FY21. The stock market managed to clock good gains in Thursday session again. However, on Friday, Sensex ended 0.43 percent lower at 38,822.57 and the Nifty closed 0.51 percent lower at 11,512.40. Losses were largely led by the pharma and auto stocks. The benchmark indices, however, had managed to trim the losses during the session but failed to get enough support and gave up in the last hour of the session.

The holiday-truncated week ahead will be driven by key economic events such as auto sales numbers, fiscal data points, economic data and RBI policy. Moreover, eyes will also be on the US-China trade talks which are scheduled next week.