Markets End Holiday-Shortened Week with Sixth Straight Decline Despite Late Recovery

Despite the late-week recovery, market sentiment remained fragile. Nifty futures on the NSE International Exchange recently traded down by 165 points, or 0.73%, at 22,540, indicating a negative opening. External pressures, including elevated crude oil prices and the ongoing US-Iran conflict, continued to influence market direction.

Hariprasad K, SEBI-registered research analyst and founder of Livelong Wealth, stated that strong demand emerging at lower levels signals an attempt by the market to build a near-term base. However, he cautioned that the broader trend is likely to remain “sell on rise” unless the index sustains above critical zones.

Ponmudi R, CEO of Enrich Money, highlighted that domestic institutional investors (DIIs) have played a stabilising role, with inflows of around Rs 29,250 crore nearly offsetting Rs 29,400 crore in outflows from foreign institutional investors (FIIs). He noted that recent gains appear relief-driven rather than indicative of a trend reversal, with rallies facing selling pressure and lacking sustained follow-through.

Ajit Mishra, SVP, Research at Religare Broking Ltd., pointed to the Reserve Bank of India’s upcoming monetary policy decision as a key event, with market participants closely monitoring guidance on interest rates and the inflation outlook.

Analysts indicated that the Nifty is currently stabilising near the 22,700 zone. Hariprasad identified immediate support at 22,500, with a critical demand base in the 22,000–22,100 range. Mishra added that deeper support lies at the 200 WEMA of 21,930, followed by 21,750. On the upside, immediate resistance is seen between 22,800 and 23,000, with a stronger supply hurdle in the 23,200–23,500 zone if these levels are surpassed.

For Bank Nifty, Ponmudi stated that the index is trading around 51,500, with a breakdown below 51,000 potentially dragging it toward the crucial 50,000 mark. Mishra identified further long-term support at 48,800 and 47,500. Resistance levels are positioned between 52,000 and 52,500, with additional supply pressure expected in the 53,000 to 55,700 range.

The Sensex, currently near 73,300, faces immediate resistance between 73,800 and 74,000. Analysts believe that a move above 75,000 is necessary to significantly shift market sentiment, while a break below 72,000 could trigger further correction toward the 71,500–71,000 zone.

Hariprasad emphasised a highly selective approach, noting that the market is entering a consolidation phase marked by low visibility. Mishra advised investors to prioritise capital preservati

on and focus on fundamentally strong large-cap stocks with clear earnings visibility, while selectively exploring opportunities in metals, energy, and IT.

The sustained volatility, continued foreign outflows, and global uncertainties underscore a cautious outlook, reinforcing the need for disciplined investment strategies as markets navigate a consolidation phase.