Indian equity benchmarks are expected to open on a negative note this Thursday, following a dip in GIFT Nifty futures. Trading on the NSE International Exchange, GIFT Nifty futures were down 68.10 points, or 0.28 percent, at 24,461, indicating a subdued start for domestic markets.
Global and Domestic Cues
The sentiment is influenced by mixed global signals. Wall Street closed slightly lower on Wednesday after a higher-than-expected US inflation reading, preceding AI giant Nvidia's earnings announcement. Key global events to watch include the release of US Q2 GDP data and further inflation figures.
Domestically, market direction is likely to be driven more by internal positioning than international trends. The monthly expiry of Sensex contracts is anticipated to trigger significant position adjustments, potentially amplifying price movements towards the session's end. Indian equities are expected to remain in a consolidation phase. Supporting domestic sentiment are falling crude oil prices and continued buying by domestic institutional investors (DIIs).
FII and DII Activity
Provisional data from the NSE revealed that Foreign Portfolio Investors (FPIs) were net sellers of Indian stocks on Wednesday, offloading shares worth Rs 502.63 crore. Conversely, Domestic Institutional Investors (DIIs) showed strong buying interest, acquiring Indian equities worth Rs 6,425.16 crore on a net basis.
Nifty50 Outlook
Analysts note consistent selling pressure at higher levels for Nifty50, which formed a bearish candle yesterday, hinting at further weakness. Shrikant Chouhan, Head of Equity Research at Kotak Securities, suggests that a fresh sell-off could occur if Nifty breaches 24,150, potentially leading it to 24,000-23,950. On the upside, a move above 24,300 could extend the rally towards 24,500-24,550.
Nagaraj Shetti, Senior Technical Analyst at HDFC Securities, highlights Nifty's subdued trend within a 24,100-24,400 range. A decisive breakout above 24,400-24,500 is needed for a sustainable upside, while a slide below 24,100-24,000 could trigger fresh weakness.
Sensex and India VIX
Sensex experienced profit booking throughout Wednesday, closing at an intraday low of 77,472.94. The index is trading below its 200-Day EMA, with its Relative Strength Index (RSI) at 48.40, indicating subdued momentum. Sachin Gupta, VP of Technical Research at Choice Equity Broking, identifies immediate support at 76,900–77,000 and resistance at 77,700–78,000.
India VIX, the volatility index, settled at 10.52, suggesting low volatility and a stable near-term market setup, as noted by Om Mehra, Technical Research Analyst at SAMCO Securities.
Bank Nifty Outlook
Bank Nifty formed a small bullish candle with an upper shadow, signaling profit booking around the 58,000 level. Bajaj Broking Research indicates the index remains within a broader range of 56,500 to 58,700. Sustaining above 58,000 could open upside towards 58,500-58,700, while failure to do so might lead to consolidation in the 57,000-58,000 range.
Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities, states that 57,300–57,200 will act as immediate support, with 58,100–58,200 as an immediate hurdle. A sustained move above 58,200 could spark a rally towards 58,600.