Pulse of the Street: Markets snap three-week slide on budget hopes, earnings boost

Subscribe to enjoy similar stories. India's benchmark stock indices snapped a three-week losing streak, as optimism around the Union budget, selective earnings beats and progress on the India-European Union (EU) free trade agreement lifted investor risk appetite, analysts said. The BSE Sensex closed the week 0.9% higher at 82,269.78 on Friday, while the Nifty50 advanced 1.1% to 25,320.65.

Yet, despite the weekly rebound, the benchmarks ended January in the red. The Nifty50 lost 2.4% during the month, while the BSE Sensex shed 2.8%, marking their weakest monthly showing since February 2025, when the markets had corrected by around 6%. Analysts say conviction around a sustained breakout rally remains weak, despite the market pricing in positive cues from the budget on Sunday.

Budget-linked sectors such as capital goods, power, defence and public sector units (PSU) rallied through the week. Investors are betting that the government will step up defence spending, sustain the infrastructure push, and accelerate stake sales in PSUs to boost non-tax revenues, Vinit Bolinjkar, head of research at Ventura, said. A spike in Brent crude prices to nearly $70 a barrel, amid fears of a potential US-Iran conflict, also lifted oil and gas stocks.

These sectors gained 5-7% over the week. In contrast, fast-moving consumer goods (FMCG) and consumer durables were the top laggards of the week, falling 2-3%. “Investors were concerned that the upcoming budget may not provide significant measures to boost consumption," Bolinjkar said.