CapitalKeeper Sunday Digest: Indian Market Wrap & Global Cues (28 July – 1 August 2025) – Mid & Small-Cap Action and Outlook
By CapitalKeeper | Sunday Digest | Indian Equities | Market Moves That Matter
Detailed weekly analysis of Indian markets for 28 July–1 August 2025. Insights on Nifty, Bank Nifty, global market cues, mid & small-cap performance, and strategies for the upcoming week.
Introduction: A Volatile Week with Mixed Sentiment
The Indian equity markets witnessed a roller-coaster ride during the week 28th July to 1st August 2025, influenced by global macro uncertainties, FII activity, and sectoral rotations. While Nifty 50 remained under mild pressure, Bank Nifty outperformed, driven by PSU banking stocks and selective private banks.
The mid-cap and small-cap segments continued to see stock-specific buying, with broader market indices outperforming benchmark indices. This divergence reflects growing retail participation and rotation of institutional money into theme-based plays like defence, renewable energy, and specialty chemicals.
Global markets were equally turbulent as investors digested US Federal Reserve commentary, crude oil price movements, and China’s stimulus measures to revive its slowing economy.
Weekly Market Recap
Nifty 50 Performance
- Opening (28 July): 24,782.45
- Weekly High: 24,900
- Weekly Low: 24,450
- Closing (1 August): 24,565.35
- Change: -217 points (-0.9%)
Bank Nifty Performance
- Opening (28 July): 56,215.10
- Weekly High: 56,750
- Weekly Low: 55,500
- Closing (1 August): 55,617.60
- Change: -597 points (-1.05%)
Fin Nifty Performance
- Opening (28 July): 26,619.40
- Closing (1 August): 26,492.50
- Change: -127 points (-0.5%)
Global Market Cues Impacting Indian Equities
1. U.S. Federal Reserve & Inflation Data
- The Fed maintained rates but signalled caution due to persistent sticky inflation.
- Dow Jones and Nasdaq traded in a narrow range as tech earnings missed some expectations.
- For Indian markets, this translated into volatility in IT stocks and weakness in export-oriented segments.
2. Crude Oil and Currency Movements
- Brent crude rose towards $88/barrel, raising concerns over India’s import bill and inflationary pressures.
- Rupee hovered near 83.40/USD, pressuring FMCG and auto sectors due to higher input costs.
3. China Stimulus and Global Commodities
- China announced a $120 billion infrastructure boost, lifting base metal prices.
- Indian metal stocks witnessed short-term rally attempts, but profit booking capped gains.
4. FII and DII Flows
- FIIs turned net sellers (₹3,200 crore outflow) amid global risk-off mood.
- DIIs supported markets with selective buying in PSU banks, power, and mid-caps.
Sectoral Performance Overview
Winners:
- PSU Banks: Robust Q1 earnings and rising credit growth boosted stocks like SBI and Canara Bank.
- Energy & Power: Strong demand forecasts and government reforms supported NTPC, Power Grid, and Adani Energy.
- Pharma & Healthcare: Post-consolidation rally with renewed focus on export opportunities.
Laggards:
- IT Sector: Profit booking after muted quarterly results from major players like TCS and Infosys.
- Metals: Weak global cues despite China’s stimulus; volatility in aluminium and steel names.
- Auto & FMCG: Impact of rising input costs and subdued demand expectations.
Mid-Cap & Small-Cap Action
- Mid-cap index outperformed Nifty by nearly 1.2%, driven by defence, capital goods, and specialty chemicals.
- Small-cap index surged 2%, with heavy retail participation in logistics, realty, and renewable energy counters.
- Stocks like Snowman Logistics, Apollo Micro, and KFintech saw volume breakouts indicating strong positional accumulation.
Key Observations:
- Positive MACD crossovers in select mid-cap names indicate potential for continued momentum next week.
- RSI for broader markets remains healthy (50-60 range), suggesting no immediate overbought conditions.
Technical Analysis: Nifty & Bank Nifty Outlook
Nifty 50:
- Support Levels: 24,450 / 24,300
- Resistance Levels: 24,800 / 25,000
- Trend: Mildly bearish but likely to consolidate; watch for reversal near 24,450 support.
Bank Nifty:
- Support Levels: 55,400 / 55,000
- Resistance Levels: 56,200 / 56,800
- Trend: Outperformance likely; PSU banks to continue driving upside momentum.
Market Outlook for Next Week (4 – 8 August 2025)
Key Triggers to Watch:
- RBI Monetary Policy (6 August): Expected status quo but commentary on inflation will be critical.
- Global Events: US jobs data, crude oil trends, and Chinese economic releases.
- Earnings Season: Mid-cap earnings (especially auto ancillaries and defence) to guide sectoral moves.
Expected Market Behaviour:
- Nifty may consolidate between 24,300–25,000 with stock-specific action.
- Bank Nifty likely to test 56,800–57,000 on continued PSU bank strength.
- Mid-cap & small-cap momentum to persist in selective pockets (logistics, defence, renewable energy).
Trading Strategy for the Upcoming Week
- Positional Traders: Accumulate quality mid-caps with positive MACD & volume breakouts (Apollo Micro, KFintech, Clean Science).
- Intraday Traders: Focus on PSU banks and energy stocks for directional plays; avoid chasing overextended rallies.
- Options Traders: Deploy Iron Condor or Bull Call Spreads around Nifty 24,500–25,000 range for risk-defined trades.
Pro Tips for New Traders
- Avoid over-leveraging: Volatility may spike around RBI policy; trade with strict stop losses.
- Focus on leading sectors: PSU banks, energy, and selective pharma remain buy-on-dips.
- Diversify exposure: Avoid concentrating only on mid-caps; keep a balanced portfolio mix.
- Track global cues: Crude, USD/INR, and US Fed commentary will dictate short-term trends.
Conclusion
The week ahead promises stock-specific opportunities amid a consolidating broader market. With global uncertainty and domestic triggers in play, traders must adopt flexible strategies—balancing defensive plays (PSU banks, pharma) with growth-oriented mid-caps in emerging themes like defence and renewable energy.
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