Indian benchmarks halt two-week losing streak on government stimulus

The Indian benchmark indices, reacting to the stimulus package announced by the government last week, ended the week on a higher note. Further, the anticipation of additional industry-specific measures for the overall revival of economy also triggered positive sentiments in the street.

Indian equity benchmarks Sensex and Nifty closed the session at 37,332.79 and 11,023.25, respectively, clocking weekly higher gains of 1.72 per cent and 1.87 per cent, respectively. Market started the week on a higher note but then gave up all the gains as the indices lost the steam on the August derivatives expiry day. On Friday, the benchmarks went on a roller coaster ride and delivered a smart bounce back in the last hour of Friday session. By breaking the losing streak, Nifty and Sensex recaptured crucial levels 11,000 and 37,350 respectively and ended the week with solid gains.

Week ahead will be largely driven by announcements made by the Finance Minister after market hours on Friday. The major announcement during the press meeting by FM was merger of PSBs. The merger of PSBs has been talked for a long time. After the government announcement on Friday, there will be only 12 banks instead of 27 PSBs in 2017. Improvement in CASA ratio is expected to be the biggest advantage post the PSU banks merger.

The slew of measures announced by the government recently to boost the economy is expected to give a direction to the market.