Where is the market headed?
A decent start to the month, with the market remaining largely flat and no major moves across segments. There were no significant announcements expected from Mr. Trump—only some entertainment, including the launch of a fragrance and a comment to Elon Musk suggesting he could return to South Africa if Tesla’s subsidies were removed. On a more serious note, the US and India are in the final stages of their tariff discussions. The outcome of this engagement may influence market direction in the coming days.
Market Overview
Nifty ended the day absolutely flat, with a marginal gain of 0.10%. Throughout the session, the index stayed within a narrow range—touching a high of 25,593 and a low of 25,501. The total intraday movement didn’t even cross 100 points, reflecting a day of very limited action.
Nifty Next 50
Nifty Junior closed with a minimal change of -0.1%, reflecting continued stagnation in the broader market.
Nifty Mid and Small Cap
Mid caps were down 0.17%, small caps slipped 0.2%
Bank Nifty
Nifty Bank moved 0.26% up.
GOLD
Gold made a notable comeback today, rising 1.05% to ₹9,748 per gram. After recent weakness, the trend now looks interesting once again, with signs of renewed strength emerging.
Advance Decline Ratio
The advance-decline ratio stood at 202 advances to 296 declines, indicating broader market weakness. However, after mid-morning, the market stabilised, with both advances and declines holding steady through the session.
Heat Maps
Bharat Electronics, Reliance, and Apollo Hospitals were the top gainers of the day, with HDFC Bank and Kotak Bank showing minor gains. On the downside, Axis Bank dropped 2%, ICICI Bank and TCS slipped nearly 1%, while Nestle fell 2.2%.
In the Nifty Next 50, losses were seen in Swiggy, Naukri, United Spirits, Britannia, ABB, Motherson, Bosch, Chola Finance, and PFC. However, Siemens and PNB gained around 2%, and several PSU banks continued to move up.
D-Mart rose 1.83%, showing relative strength, while TVS Motor, despite reporting strong results, was down 0.8%. Godrej Consumer, VBL, and GAIL also posted losses.
Sectoral Overview
PSU banks led the sectoral trends with a 0.7% gain, followed by oil and gas at 0.5%, and infrastructure and defence both up 0.45%. Defence had risen more in the morning but gave up some gains by the close.
On the downside, media was the worst performer with a 1.3% drop. FMCG also continued its dull phase, down 0.69%, with barely any sessions showing gains recently. MNC stocks slipped 0.5%, while the rest of the sectors remained broadly flat.
Sector of the Day
Nifty Media Index
Media appears to be forming a rounding top pattern, signalling potential weakness. The sector saw notable declines with Zee Entertainment, Network18, DB Corp, PVR, and Saregama all ending in the red, contributing to the broader weakness.
Story of the Day: Indian Investors vs. Central Banks
Central‑bank gold buying has accelerated dramatically.
After averaging roughly 500 tonnes a year from 2010‑21, official purchases have doubled to about 1,000 tonnes in each of the past three years, even though annual global mine supply has stagnated near 3,000 tonnes. The consequence is a persistent demand–supply imbalance that has helped push bullion prices to record highs.
This surge in official demand reveals deep reservations about the current fiat‑currency regime. Monetary authorities—entities that can theoretically print unlimited money—are nonetheless stockpiling an asset that cannot be created at will.
Latest World Gold Council surveys show 95 % of central‑bank respondents expect reserves to keep rising over the next 12 months, while 73 % foresee a lower US‑dollar share in total reserves within five years.
The dollar’s weight in global reserves has already slipped from nearly 60 % in 2016 to about 46 %, while gold has overtaken the euro to become the second‑largest reserve asset at roughly 20 % (see the image below)
The strategic motives are clear. Gold offers insurance against geopolitical shocks, protection from inflation stoked by repeated rounds of money‑printing, and complete freedom from default risk. Conflict‑related asset freezes—such as the 2022 seizure of Russian reserves—have underscored the vulnerability of holding other nations’ debt. In contrast, bullion held in vaults is immune to sanctions.
India’s long‑standing affinity for gold has been vindicated. Average rupee‑denominated returns stand near 11 ½ % CAGR over the past 50‑plus years, and household holdings exceed 25,000 tonnes. The past 12 months alone have added more than a trillion dollars of wealth to domestic balance sheets as prices rallied.
The implication for investors is unambiguous: the very institutions that issue paper currencies are hedging those currencies with bullion. Ignoring that signal risks missing a structural re‑rating of gold’s role in the global monetary system.
How much portfolio insurance does physical or ETF gold provide in the current cycle ? Share views in the comments, and if these insights were useful, feel free to SHARE this blog with friends and family!
