Indian Stocks Snap Winning Streak With Diwali Loss

The Indian stock market closed lower during the special Diwali trading session, bringing an end to a seven-session winning streak. The BSE Sensex shed 28.62 points to close at 80,999.40, while the Nifty 50 finished 0.2 percent lower at 24,986.40. Investors booked profits following a steep rally, marking the first time in nine years that benchmark indices ended in the red on Diwali.

Sector Performance And Market Volatility

Sectoral indices ended mixed as pharmaceuticals and healthcare gained up to 2 percent, while IT and financial services weighed on the broader market. Heavyweights such as ICICI Bank and HDFC Bank finished lower, though broader market indices saw robust gains. The India VIX pressure gauge rose 5 percent to gain for the third straight session, highlighting ongoing market uncertainty.

Expert Outlook And Global Factors

Market experts remain positive despite the session's losses, noting that benchmark indices still ended the week 8 to 9 percent higher. Avinash Agarwal of Bandhan Life and Ramdeo Agrawal of Motilal Oswal Financial Services both expressed optimism regarding earnings growth and low valuations heading into the new Hindu business year. Meanwhile, foreign portfolio investors purchased shares worth $4.6 billion during the week, reversing part of their earlier outflows.

Context

Special Diwali trading sessions, known as Muhurat trading, are a long-standing tradition on Indian stock exchanges where investors conduct symbolic trades for good fortune in the new Hindu financial year. Market fluctuations during these brief one-hour sessions often reflect profit-taking after festive rallies rather than long-term economic shifts.