Indian stock markets are likely to extend their gains during the trading session on Tuesday after a strong start for the week on Monday. Dalal Street indices shall track the positive global cues and gains in the Asian stocks. However, inflation data from the US and India shall guide the sentiments of traders.
Nifty futures on the NSE International Exchange traded 62.70 points, or 0.25 per cent, higher at 25,244.50, hinting at a positive start for the domestic market on Tuesday. Asian stocks were buoyant on Tuesday. Japan’s Nikkei and South Korea’s KOSPI gained nearly a per cent, while Hang Seng was also trading in green.
Market participants would be tracking the upcoming US May Retail Inflation data to be released on Wednesday, followed by India’s CPI on Thursday, said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. “We expect the market to continue its gradual up-move over better than expected Q4 earnings, RBI’s measures, better monsoon forecast and US-India trade deal.”
Wall Street stocks ended slightly higher on Monday as investors watched U.S.-China negotiations. The S&P 500 climbed 0.09 per cent to end the session at 6,005.88 points. The Nasdaq gained 0.31 per cent to 19,591.24 points, while the Dow Jones Industrial Average ended essentially unchanged at 42,761.76 points.
In currencies, the dollar attempted to regain its footing after falling on Monday as Washington and Beijing remained locked in trade talks. The dollar index was steady at 98.986, not far from the six-week low it touched last week. On the other hand, rate sensitive Bitcoin jumped nearly 4 per cent to hover around the $1,10,000 mark.
In the oil market, prices edged up, with Brent crude futures gaining 0.24 per cent to $67.20 a barrel. US West Texas Intermediate crude was last up 0.25 per cent at $65.45 per barrel after hitting a more than two-month high earlier in the session. Spot gold fell 0.5 per cent to $3,310.40 an ounce.
“We maintain our bullish outlook and recommend a focus on selective stock picking during any intermediate consolidation or dip,” said Ajit Mishra, SVP of Research at Religare Broking. “Participants should exercise caution in broader markets, which are currently buoyed by strong domestic flows and sentiment. Emphasis should remain on themes and stocks where the risk-to-reward ratio continues to be favorable.”
Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 1,992.87 crore on Monday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 3,503.79 crore on a net-net basis.
Sentiment remains bullish, fuelled by RBI’s surprise 50 bps rate cut, hopes of positive India-US trade talks, and expectations of a Fed rate cut, said Prashanth Tapse, Senior VP (Research) at Mehta Equities. “Bank Nifty likely to outperform,” he said.
Nifty & Sensex Outlook
Nifty50 appears poised to extend its up-move in the near term. Traders are advised to continue with a ‘buy on dips’ approach, said Rajesh Bhosale, Equity Technical Analyst at Angel One. “Immediate support is placed near the psychological 25000 mark, while the bullish gap between 24940 – 24900, which aligns with the bullish breakout zone, is expected to act as strong support.”
Shrikant Chouhan, Head Equity Research at Kotak Securities views that 25,000/82,000 would act as a sacrosanct support zone for trend-following traders. “The uptrend is likely to continue. On the higher side, it could move up to 25,350-25,400/82,800-83,000. On the flip side, falling below 25,000/82,000 would render the uptrend vulnerable,” he said.
Nifty Bank outlook
Nifty Bank index formed a small bear candle with a higher high and higher low and a bullish gap, signaling positive bias and continuation of the up move, said Bajaj Broking. “We expect It to maintain positive bias and head higher towards 57,300 and 57,700 levels in the near term. The short-term structure remains constructive with immediate support at 55,900,” it said.
A sustained move beyond 57,120 could open the path toward 57,700-57,900, aligning with the 0.618 Fibonacci projection, said Om Mehra, Technical Research Analyst at SAMCO Securities. “However, a drop below the breakout base may lead to short-term mean reversion, offering a cleaner risk-reward setup for fresh entries. Overall, the trend in Nifty Bank remains firmly positive,” he said.
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