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Broader Market Shines Amid Nifty Consolidation

ICICIdirect Research 22 May 2026 DISCLAIMER

Indian equity benchmarks recovered a portion of the previous week’s losses, as renewed optimism surrounding potential peace negotiations fueled the momentum in the market. The Nifty gained 0.5% at 23780. In the process, Midcaps continued with its relative outperformance by gaining 1%.

Week that was:

Over past seven sessions index has been trading in a narrow range of 23800-23200 while discounting host of the negativity around geopolitical conflict. Stocks specific activity continued while sailing through earning season.

What we expect:

  • Going ahead, we expect the index to eventually resolve out of this consolidation and resumed upward momentum that can drive Nifty towards 24400 in the coming weeks.
  • In the upcoming truncated week, we expect bouts of volatility to remain elevated ahead of monthly expiry and ongoing earning season. Thereby, focus should be on accumulating quality stocks backed by strong earnings
  • The ratio chart of Nifty 500 vs Nifty 100 has been inching upward, confirming sustained outperformance of the broader market, backed by improving market breadth. Amidst geopolitical uncertainties currently, 72% of Nifty 500 stocks are trading above their 50-day SMA compared to last week’s reading of 68%.   

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