Where is the market headed?
A departure from the usual market layout brings focus to two key charts. The primary, larger chart highlights MCX Gold, where prices are attempting to break out from their recent consolidation range. Beside it, the hourly chart of United States yields reveals a sudden drop of 10 basis points yesterday for the first time in recent sessions.
While a 10 basis point drop is modest, it hints that US yields may have formed a temporary top, a development that will become clearer in the coming days and weeks. Should this prove to be a genuine turning point in US yields, it will directly impact emerging markets and precious metals, both of which act as contra trades to US yields. Indian equities displayed stronger performance today, likely reflecting this macro shift.
Market Overview
The trading week concluded after what had not been a great week to start the month of October. Yesterday presented a complete surrender from buyers, yet today saw most of those losses recovered, with the Nifty securing a 1.3 percent gain.
On the weekly chart inset, the Nifty posted a positive week following eight straight losses, forming a doji candle. A doji candle indicates market indecision, which usually signals either a trend reversal or the end of an existing trend. This forms the exact opposite setup of eight or nine weeks ago when a doji candle heralded the start of the prolonged downtrend, offering a subtle reason for optimism that the recent fall may be nearing its end.
Major Market indices
The broader market also closed slightly in the green, though these represent minor jumps after significant selling, meaning it is too early to declare a definitive trend change. The Nifty Next 50 gained 0.82 percent, mid-caps rose 1.3 percent, small-caps advanced by 0.5 percent, and Bank Nifty posted a strong gain of 1.36 percent.
Heat Maps
The Nifty heat map was largely green, defying news that Infosys and Tata Consultancy Services would face H1B visa hurdles. Both TCS and Infosys rallied, while ITC rose over 4 percent following clarity regarding its 9000 crore slump sale. Adani stocks rebounded, auto stocks that suffered yesterday recovered, and major lenders like State Bank of India and HDFC Bank actively participated in the move.
Trading activity was led by TCS with the highest turnover of the day, followed by Adani Ports. Infosys, HDFC Bank, Kotak Mahindra Bank, and Reliance Industries were also among the top turnover names. In small-cap stocks, Cupid surged 2.6 percent, defying gravity and generating the highest turnover in its segment. Apollo Hospitals rose 5 percent, ITC gained 4.3 percent, Steel Authority of India was up 3 percent, and Colgate-Palmolive jumped 4.7 percent after a prolonged period of quiet trading. Whether this action is a genuine relief rally or simply a dead cat bounce, it provided a positive conclusion to the week.
Advance/Decline Trend
Market breadth shifted favorably to 352 advances against 146 declines, a welcome change not seen in many days.
Sectoral Overview
Sectoral trends showed a 3 percent gain on Nifty IT and a long-awaited 2.2 percent gain on Nifty FMCG. PSU banks advanced 1.6 percent alongside gains of 1 percent or more in consumption, auto, financial services, tourism, and metals.
Looking at the broader one-month performance, every sector remains negative with the sole exception of media. The worst-hit sectors over the past month include metals at minus 10 percent, autos at minus 10 percent, and defense stocks at nearly minus 9 percent. Persistent Systems, LTI Mindtree, TCS, HCL Tech, and CoForge contributed the most to the IT index gain.
Sector of the Day
Nifty IT Index
U.S. Market Update
Global markets provided a subdued backdrop as the previous US session closed slightly down, with the S&P 500 slipping half a percent, the Dow Jones finishing flat, and the Nasdaq dropping 1.4 percent due to bleeding in artificial intelligence stocks.
Notable US tech and AI losers included Astera Labs, CoreWeave, Nebius, Arm Holdings, and Lumentum, along with a 4 percent decline in SpaceX and losses in mega-caps like Amazon, Microsoft, and Nvidia.
On the positive side, gainers included Diamondback, PepsiCo, Adobe, Old Dominion, and Copart, highlighting a broad technology correction in the US.
Tweet Of The Day
The tweet of the day focused on Colgate-Palmolive, reflecting on how the stock fell from 3800 rupees to 1700 rupees despite widespread market narratives. The common narrative held that Colgate could not fail because 140 crore people require toothpaste and the company holds a leading market position. Popular narratives often contain illogical assumptions, as seen when the stock traded at 80 times earnings at 3800 rupees.
Price remains the truest friend in market analysis; if price is falling, the asset is in a downtrend regardless of the story, and if price is rising, the trend should be respected. This price-following principle forms the core strategy at Weekend Investing and has proved reliable over many years.
