Indian Markets Eye Positive Open Amid Global Rally
Indian equity benchmark markets are anticipated to open on a positive note, extending recent gains. This optimism is fueled by a strong rally on Wall Street and a broad rebound across Asian markets, which has significantly improved global risk sentiment. Furthermore, foreign institutional investors (FIIs) have turned net buyers of domestic equities, providing an additional boost to investor confidence despite ongoing geopolitical uncertainties.
Global Cues and Market Performance
GIFT Nifty Futures on the NSE International Exchange were up 66.50 points, or 0.027 percent, trading at 24,424.50, signaling a favorable start for the domestic market on Friday. Globally, Wall Street concluded Thursday's session sharply higher, driven by strong forecasts from a major technology company that alleviated concerns about substantial investments in AI infrastructure. The S&P 500 advanced 1.66 percent, the Nasdaq gained 2.78 percent, and the Dow Jones Industrial Average rose 1.19 percent.
Asian markets mirrored this rally on Friday, with hopes that the recent sell-off in AI-linked assets might be losing momentum. South Korea's KOSPI surged over 13 percent, while Japan's Nikkei climbed nearly 5 percent, though Hong Kong's Hang Seng edged lower. Crude oil prices saw a slight increase due to persistent tensions in the Middle East, with Brent crude futures up 0.4 percent at $89.38 per barrel. The US dollar was marginally higher, while spot gold experienced a minor dip.
FII-DII Flows and Expert Insights
Provisional data from the NSE indicates that Foreign Portfolio Investors (FPIs) were net buyers of domestic stocks, injecting ₹3,623.51 crore on Thursday. Conversely, domestic institutional investors (DIIs) were net sellers, offloading Indian equities worth ₹1,864.03 crore. Analysts maintain a cautious but positive outlook, suggesting a 'buy-on-dips' strategy, favoring stronger stocks across various sectors while emphasizing disciplined risk management.
Nifty50 and Sensex Outlook
Technical indicators suggest a positive short-term trend for Nifty50, with the market trading comfortably above its 20-day Simple Moving Average (SMA). A bullish candle on daily charts and an uptrend continuation on intraday charts point to potential further gains. For trend-following traders, 24,200/77,500 are identified as key support zones. A sustained move above these levels could see the rally extend towards 24,450-24,500 for Nifty50 and 78,300-78,500 for Sensex. However, a breach below 24,200/77,500 might render the uptrend vulnerable, prompting traders to consider exiting long positions.
Sensex is currently trading above its 20-day, 50-day, and 100-day Exponential Moving Averages (EMAs), signaling a positive near-to-medium-term trend. The Relative Strength Index (RSI) has improved to 57.58, indicating strengthening momentum. While the long-term trend, represented by the 200-day EMA, has yet to turn decisively bullish, the overall sentiment remains optimistic for continued upside.
Nifty Bank Analysis
Nifty Bank has been consolidating within the 57,330–56,672 range, reflecting a period of range-bound price action. It oscillates between its 20-day and 50-day EMAs, suggesting an absence of a clear directional trend. The RSI has flattened, indicating a lack of strong bullish or bearish momentum, and the Average Directional Index (ADX) remains flat, hinting at weak trend strength and subdued volatility.
Immediate resistance for Nifty Bank is situated in the 57,500-57,600 zone. A sustained move above this could lead to an extension of the pullback towards 58,000, followed by 58,400 in the short term. On the downside, immediate support is placed in the 56,700-56,600 zone. The 56,500–56,000 zone is considered a crucial support area, reinforced by multiple technical indicators, suggesting a constructive broader outlook as long as the index holds above this cluster.