For the week, the BSE Sensex index shed 1,070.39 points or 1.3 percent to end at 81,118.60, and Nifty50 fell 284.45 points or 1.13 percent to close at 24,718.60.

Broader indices ended mixed in a volatile week, with the BSE Large- and Mid-Cap indices each slipping 1 percent. However, the Small-Cap index closed flat.

The BSE Sensex declined 1,070.39 points, or 1.3 percent, to settle at 81,118.60, while the Nifty50 shed 284.45 points, or 1.13 percent, ending the week at 24,718.60.

Foreign Institutional Investors (FIIs) remained net sellers for the fourth consecutive week, offloading equities worth ?1,246.51 crore. In contrast, Domestic Institutional Investors (DIIs) extended their buying streak for the eighth straight week, pumping in ?18,637.29 crore.

On the sectoral front, Nifty Realty led the decline with a 3 percent drop, followed by PSU Bank (-2.3 percent), FMCG (-2 percent), Bank (-~2 percent), and Metal (-1.5 percent). Bucking the trend, Nifty IT gained 3 percent, while Media and Pharma indices rose over 1 percent each.

"Indian equity markets witnessed heightened volatility this week, ultimately closing in the red. Early optimism, driven by progress in U.S.–China trade negotiations, was overshadowed by escalating geopolitical tensions after Israel launched a strike on Iran’s nuclear facilities. This development sparked a global risk-off sentiment, leading to a rally in safe-haven assets such as gold and U.S. bonds. Oil prices surged past $76/barrel after months of consolidation, as fears of supply disruptions resurfaced," said Vinod Nair, Head of Research, Geojit Investments.

"On the domestic front, CPI inflation eased to a 75-month low, offering some relief. However, the recent spike in crude prices could reverse this trend if the Middle East conflict intensifies. Sectorally, rate-sensitive segments like auto, realty, and banking saw profit booking, while export-oriented sectors such as IT and pharma gained amid a weaker rupee."

"Looking ahead, investors are expected to remain cautious amid premium valuations and geopolitical risks. All eyes are now on the upcoming U.S. Fed meeting, where interest rates are likely to remain unchanged. However, the Fed’s commentary and economic projections will be closely scrutinised for future policy cues," he added.

The BSE Small-cap index ended on a flat note. Advait Energy Transitions, Rattanindia Enterprises, SMC Global Securities, GOCL Corporation, Suratwwala Business Group, Motisons Jewellers, Electrosteel Castings, Expleo Solutions, Dhani Services, Somany Ceramics added between 20-28 percent, while Sadhana Nitrochem, Orient Cement, Deccan Gold Mines, Harsha Engineers International, Cupid lost between 10-22 percent.

Where is Nifty50 headed?

Amol Athawale, VP-Technical Research, Kotak Securities:

The week opened positively, but once again, the market faced resistance near 25,200/82800 and reversed. Technically, on weekly charts, it has formed a long bearish candle and is currently trading comfortably below the 20-day SMA (Simple Moving Average), which is largely negative.

We believe that as long as the market remains below the 20-day SMA or 24,850/81600, weak sentiment is likely to continue. On the downside, the market could retest the level of 24,500/80500. A breach of 24,500/80500 could accelerate selling pressure. Below this level, the index could slip to the 50-day SMA around 24,300/79900.

On the upside, a break above 24,750/81300 could extend the pullback move up to 24,850/81600. Further gains may also continue, lifting the market toward 24,950–25,000/81900-82100.

For Bank Nifty, the key support zone is between 55,000 and 55,200. Above this range, it could bounce back toward 56,100–56,300. Conversely, a fall below 55,000 increases the likelihood of testing the 50-day SMA or 54,500.

Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services

We expect market focus to remain on oil exploration companies on the back of rise in crude prices amidst the backdrop of escalation in Israel-Iran military action. Further, any such escalation would have a positive rub off effect on domestic defence companies on expectation of increased export orders amidst higher defence spending. Overall, we expect the market to remain subdued on the back of weak global cues, while industry-specific news flows would continue to drive sectoral movements.