Geopolitical developments will dictate mkt course

A likely dollar-selling intervention by the Reserve Bank of India may have curbed sharper losses, say observers. High-frequency indicators exhibit the positive trends in economy: manufacturing PMI surged to 59.3, a 17-year high, while services PMI jumped to 62.9, marking the highest level in 15 years

On the back of positive macroeconomic data like 17-year high manufacturing PMI, a services PMI at a 15-year high, GST reforms, persistent DII buying, and supportive global cues; markets erased and recouped some of the previous fortnight’s losses during the week ended.

For the week, the Sensex rose 901.11 points or 1.12 percent to finish at 80,710.76, while the Nifty added 314.15 points or 1.28 percent to close at 24,741. Broader markets witnessed “bottom fishing” helping the BSE Mid-cap Index gain nearly 2 percent and the BSE Small-cap index adding 2.5 per cent. Selling from FIIs continued 10th consecutive week, selling equities worth Rs5,666.90 crore.

On the other hand, DIIs continued their buying in the 21st consecutive week, with equity purchases worth Rs13,444.09 crore. It is pertinent to observe that foreign investors’ presence in Indian equities slumped to a thirteen-year low in August, with their share in NSE-listed companies slipping to 15.85 percent. Data from the NSDL show foreign portfolio assets in equities narrowing to Rs70.33 lakh crore from Rs71.97 lakh crore a month earlier, a decline of 2.3 per cent.

It is interesting to note that FIIs have sold nearly Rs1.7 lakh crore from Indian markets since Januaryeven as benchmark indices held firm: the Sensex and Nifty have each advanced almost 4 percent in 2025. Interestingly, DIIs have poured over Rs5.2 lakh crore into equities this year, pushing their ownership to a record 17.82 percent in the June quarter. According to Prime Database, DIIs first surpassed foreign investors in March 2025, and the widening gap highlights how local money now anchors Indian markets.

Analysts attribute the persistent foreign sell-off to expensive valuations, moderating corporate earnings, tariff worries, and a pivot toward cheaper, better-performing markets such as the United States, China and Europe. Indian rupee slipped to a fresh low of 88.3613 against the US dollar during the course of last week, weighed down by foreign outflows in equities and ongoing pressure from Trump’s tariffs, amid some reports of RBI intervention to curb sharper losses.

A likely dollar-selling intervention by the Reserve Bank of India may have curbed sharper losses, say observers. High-frequency indicators exhibit the positive trends in economy: manufacturing PMI surged to 59.3, a 17-year high, while services PMI jumped to 62.9, marking the highest level in 15 years. On the external front, the current account deficit narrowed to 0.2 per cent of GDP, and FDI equity inflows grew ~15 per cent YoY in Q1, reflecting external stability and investor confidence.

A day after posting that the US had “lost India and Russia to deepest, darkest, China,” President Donald Trump said the India-US relationship remained “special” and that he continues to share a strong personal bond with Prime Minister Narendra Modi.

This sudden thaw in tensions raises hopes of quick resolution to US-India trade talks. Near term direction of the market will be continued to be dictated by geo political developments, FII fund flows, rupee-dollar moves and international crude oil prices.

Be prepared to invest in a down market and to “get out” in a soaring market, as per the philosophy of Warren Buffett.

FUTURES & OPTIONS / SECTOR WATCH

Digesting the changes in weekly settlement days, derivative segment witnessed brisk trading volumes. Despite the market recouping some of its losses in the earlier fortnight, the selloff in the last two sessions after the announcement of GST reforms shows that the bulls have not gathered enough strength to reverse the weak trend.

In the monthly options segment, the highest Call open interest is at 25,000 and 25,500 strikes. The highest Put open interest is at 24,500 and 24,000 strikes. The Put Call Ratio (PCR) of the weekly options is at 0.80. However, PCR of monthly options is at 1.10 indicating that rebound in the market is on cards.

Nifty is currently stuck in a range of 24,300-25,150 for nearly a month. A breakout on either side will determine whether Nifty can rise back to 26,000 or fall to 23,000 levels. Bank Nifty is confined to range of 53,550-55,000 for present.

Bank Nifty, has been consistently underperforming frontline indices over the past couple of weeks.The combined weight of HDFC Bank and ICICI Bank in the Bank Nifty is nearly 55 per cent, making it imperative for both heavyweights to perform well for the index to do so. FMCG stocks witnessed profit booking after the announcement of GST reforms and are likely to witness consolidation in the short term.

However, they are likely to continue their northward journey in the next few festival months. Technically, several stock futures are showing strong relative strength and are likely to continue their outperformance in the near term.

Stocks looking good areAshok Leyland, HUL, ITC, ICICI Bank, NALCO, KFIN Tech and Voltas. Stocks looking weakare Apollo Hosp, Cipla, PI Inds,Trent, Policy Bazar and Siemens.

(The author is a senior maket analyst and former vice-chairman, Andhra Pradesh State Planning Board)

STOCK PICKS

Carysil Limited

Carysil Limited is engaged in manufacturing and trading quartz kitchen sinks, stainless steel kitchen sinks, bath products, tiles, kitchen appliances and accessories. The activities of the company fall under a single segment of manufacturing and trading of kitchen sinks and other appliances.

Its kitchen sinks products include Quartz Sinks, Stainless Steel Sinks, Green Sinks, and Sink Accessories. Its faucets products include faucets, and food waste disposers. Its built-in appliances include chimneys, coffee makers, cooking ranges, cooktops, dishwashers, hobs, ice makers, microwaves, wine chillers, and ovens.

Its brands include Sternhagen, Tekcarysil, and Carysil. Favourable trade conditions, coupled with rising manufacturing costs in Europe, give the company a distinct edge in both cost efficiency and quality, enabling deeper market penetration.

At the same time, the domestic market is advancing with the launch of premium quartz sink designs and workstation sinks, strategically positioning thecompany to capture value-driven growth both at home and internationally. Strategic alliances with global retailers and top-tier kitchen brands strengthen the company’s competitive edge and drive its long-term growth strategy.

The company’s subsidiaries include Carysil Online Limited, Carysil Steel Limited, Carysil Ceramictech Limited, Carysil Gmbh, Carysil UK Limited, Acrysil USA Inc., and others. It serves countries, including the United States, the United Kingdom, Germany, France, China, and others. Buy on declines for medium term target of Rs1500.