By V K Sharma
The Nifty ended the week up 426 points, or 1.93%, at 22,552, marking its first weekly gain after three consecutive losses and the highest percentage gain since the week of December 6. The NSE SmallCap Index surged 5.47%, while the Nifty MicroCap Index jumped 6.71%.
Two key highlights of last week’s trade were the overwhelmingly positive market breadth over the last three days and the Nifty closing above the five-day exponential moving average (5 DEMA) on March 5. The last time the Nifty closed above the 5 DEMA was on February 6, 2025.
The last week’s rally has come on lower volumes. This is understandable as after weeks of decline, investors do not have the confidence to buy, especially if they have not sold at higher levels.
On Friday, the US reported non-farm payroll data that came in weaker at 1,51,000 than the expected 159,000 jobs. The unemployment rate, which is collated by a different methodology, came in at 4.1%. This was higher than January’s 4.0%.
On Thursday, Trump announced a temporary exemption for goods imported from Canada and Mexico under the United States-Mexico-Canada Agreement (USMCA), delaying the implementation of a 25% tariff until April 2.
But on Friday Trump was back to his histrionics, saying that he could put reciprocal tariffs on Canadian Dairy and lumber and could consider easing energy sanctions on Russia to incentivise them to reach a deal on a ceasefire in Ukraine.
In the background of ever-changing trade policy of Trump, Fed Chair Jerome Powell was a picture of calm when on Friday he suggested that the central bank may continue to take a patient approach on interest rates as the economy remains in a good place despite elevated uncertainty.
Wall Street rallied Friday after Powell’s comments and closed with gains, recouping the intraday losses. For the week however, Dow slipped 2.4%, the S&P 500 fell 3.1% and Nasdaq slumped 3.5%.
US and Ukrainian officials are slated to meet in Saudi Arabia this Wednesday. Trump has scheduled this meeting after Zelensky tendered an apology following the February 28 public spat. Any agreement that puts an end to the three-year-old Russia-Ukraine war should be music to the market ears.
Making use of the current low crude prices, the US could begin refilling the nation’s depleted Strategic Petroleum Reserves.
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