Indian markets end nearly flat after rally

Indian equity markets ended nearly flat on Wednesday after a six-session rally. Investors took a cautious approach, recalibrating their portfolios following the recent surge. The benchmark indices saw minimal fluctuations throughout the trading session, reflecting mixed sentiments among market participants. Analysts had anticipated this small pause as the markets digested recent gains and awaited fresh catalysts for further direction. A nascent recovery in Indian stocks gained momentum on Monday. Investors wagered that the worst is over following a monthslong slump that wiped off more than a trillion dollars in value.

The Nifty Chemicals Index tracks the performance of top chemical sector stocks from the Nifty 500. Selected based on free-float market capitalization, it serves as a benchmark for fund portfolios and a base for ETFs, index funds, and structured products.#NSE #NSEIndia… pic.twitter.com/h1fpN0lYOR

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The NSE Nifty 50 Index climbed 1.3% at the close, marking its sixth day of gains and erasing all its losses for 2025. “Confidence is coming back,” said Sonam Srivastava, founder of Wright Research in Mumbai. “There is an expectation of earnings bottoming out. We are seeing a convincing recovery in various stocks, and this rally definitely seems to have legs.” Several indicators of economic growth—including tax collections and power demand—have improved in recent weeks. This has boosted confidence following a selloff in stocks that started in September.

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Foreign investors also increased their long positions in index futures, with the long-short ratio improving to 31.8%. This indicates “a gradual shift towards optimism—a factor that likely boosted sentiment in today’s session,” said Sundar Kewat, technical and derivatives analyst at Ashika Stock Broking. Despite a positive start, profit booking in several heavyweight sectors led to a range-bound trading day on March 25, ultimately eroding early gains. The Sensex rose slightly by 32.81 points, closing at 78,017.19, while the Nifty increased by a marginal 10.30 points, ending the session at 23,668.65. IT stocks were the day’s standout performers, providing much-needed support to the indices. However, all other sectoral indices ended in the red.

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Cautious stance halts rally momentum

Auto, capital goods, consumer durables, metal, oil & gas, power, PSU bank, and realty sectors declined by 1-1.5%. “After six consecutive sessions of gains, the markets paused and closed on a flat note,” said Ajit Mishra, SVP of Research at Religare Broking. “Early trade sentiment was positive, but profit booking across sectors led to a range-bound session. The Nifty ended unchanged, and most sectors witnessed profit booking, closing in the red.” With the earnings season approaching, market participants remain cautious. Potential rate cuts and rupee movements are expected to influence market sentiment. Investors are advised to adopt a “buy on dips” strategy focusing on selective stock picking, particularly in the banking and financial sectors, while exercising caution in other sectors. Image Credits: Photo by Maxim Hopman on Unsplash