Markets staged a strong rebound, rallying over 4.5% during the holiday-shortened week, supported by positive signals from domestic and global developments. Benchmark indices opened the week with a sharp gap-up and extended their gains through the following sessions.
Consequently, the Nifty and the Sensex ended near their weekly highs, closing at 23,851.65 and 78,553.20, respectively.
The rally was largely driven by optimism over the deferral of tariffs and exemptions on select products, fueling hopes of trade negotiations. Markets also reacted positively to updates on a normal monsoon, easing retail inflation, which boosted rate cut expectations, and a stable global backdrop.
“Index on weekly chart has formed a sizable bull candle with a higher high and higher low signaling continuation of the up move. The index in the process formed a higher high in the monthly chart, highlighting strength. Index to maintain overall positive bias and gradually head towards 24,200-24,300 levels in the coming weeks, being the high of January 2025 and 123.6% external retracement of the recent breather (23,869- 21744). Volatility is expected to remain elevated amid tariff-related developments and the progress of the Q4 earnings season. Dips, if any, in the coming week should be used as a buying opportunity with key support placed at 23,200 levels,” said Bajaj Broking Research.
Key events to watch when the markets open this week:
1. Q4 earnings
In the week ahead, focus will be on the reaction on earnings from major players including Infosys, HDFC Bank, and ICICI Bank. Quarterly results from HCL Technologies, Axis Bank, Hindustan Unilever, and Maruti will also be on the radar.
2. Monthly expiry
On the derivatives front, the upcoming expiry of April series contracts is likely to heighten market volatility.
3. Global updates
Globally, developments around tariffs and their potential impact on world markets will also be closely tracked.
4. Technical factors
Technically, Nifty has been trading within a broad range of 21,700–23,800 over the past two months and has now reached the upper end of this band. Moreover, it has reclaimed key moving averages—the 100 and 200-day EMAs.
“Going forward, the prevailing positive momentum is expected to continue, with a potential upside towards the 24,250–24,600 zone. In case of a dip, the 23,000–23,300 zone is likely to act as a support,” said Ajit Mishra – SVP, Research at Religare Broking.
5. FII-DII activity
Foreign institutional investors (FIIs), on Friday, recorded net buying of Rs 4,667.94 crore in the Indian equities. However, domestic institutional investors (DIIs) were net sellers at Rs 2,006.15 crore.
6. Currency movement
The rupee posted gains, buoyed by steady FII inflows and expectations of continued foreign investment. Sentiment was further lifted by a sharp rally in Indian equities, especially in the financial sector, which maintained strong momentum.
A decline in the dollar index below 99.80 also supported the rupee, as easing trade tensions improved global risk appetite. The combination of robust capital market activity and a softer dollar has helped keep the rupee firm in recent sessions.
7. Crude prices
Crude Oil WTI Futures closed 3.5% higher at $64.68 supported by mounting supply disruption concerns, improving prospects for US-China trade talks, and falling product inventories.
China indicated a willingness to restart trade talks with the Trump administration, though it emphasized that this would depend on certain preconditions. Meanwhile, expectations for easing U.S. sanctions on Iranian oil faded after Washington insisted that Iran fully cease its nuclear enrichment and weaponization efforts—a demand firmly rejected by Iranian Foreign Minister Abbas Araghchi, who described uranium enrichment as “non-negotiable.”
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Consequently, the Nifty and the Sensex ended near their weekly highs, closing at 23,851.65 and 78,553.20, respectively.
The rally was largely driven by optimism over the deferral of tariffs and exemptions on select products, fueling hopes of trade negotiations. Markets also reacted positively to updates on a normal monsoon, easing retail inflation, which boosted rate cut expectations, and a stable global backdrop.
“Index on weekly chart has formed a sizable bull candle with a higher high and higher low signaling continuation of the up move. The index in the process formed a higher high in the monthly chart, highlighting strength. Index to maintain overall positive bias and gradually head towards 24,200-24,300 levels in the coming weeks, being the high of January 2025 and 123.6% external retracement of the recent breather (23,869- 21744). Volatility is expected to remain elevated amid tariff-related developments and the progress of the Q4 earnings season. Dips, if any, in the coming week should be used as a buying opportunity with key support placed at 23,200 levels,” said Bajaj Broking Research.
Key events to watch when the markets open this week:
1. Q4 earnings
In the week ahead, focus will be on the reaction on earnings from major players including Infosys, HDFC Bank, and ICICI Bank. Quarterly results from HCL Technologies, Axis Bank, Hindustan Unilever, and Maruti will also be on the radar.
2. Monthly expiry
On the derivatives front, the upcoming expiry of April series contracts is likely to heighten market volatility.
3. Global updates
Globally, developments around tariffs and their potential impact on world markets will also be closely tracked.
4. Technical factors
Technically, Nifty has been trading within a broad range of 21,700–23,800 over the past two months and has now reached the upper end of this band. Moreover, it has reclaimed key moving averages—the 100 and 200-day EMAs.
“Going forward, the prevailing positive momentum is expected to continue, with a potential upside towards the 24,250–24,600 zone. In case of a dip, the 23,000–23,300 zone is likely to act as a support,” said Ajit Mishra – SVP, Research at Religare Broking.
5. FII-DII activity
Foreign institutional investors (FIIs), on Friday, recorded net buying of Rs 4,667.94 crore in the Indian equities. However, domestic institutional investors (DIIs) were net sellers at Rs 2,006.15 crore.
6. Currency movement
The rupee posted gains, buoyed by steady FII inflows and expectations of continued foreign investment. Sentiment was further lifted by a sharp rally in Indian equities, especially in the financial sector, which maintained strong momentum.
A decline in the dollar index below 99.80 also supported the rupee, as easing trade tensions improved global risk appetite. The combination of robust capital market activity and a softer dollar has helped keep the rupee firm in recent sessions.
7. Crude prices
Crude Oil WTI Futures closed 3.5% higher at $64.68 supported by mounting supply disruption concerns, improving prospects for US-China trade talks, and falling product inventories.
China indicated a willingness to restart trade talks with the Trump administration, though it emphasized that this would depend on certain preconditions. Meanwhile, expectations for easing U.S. sanctions on Iranian oil faded after Washington insisted that Iran fully cease its nuclear enrichment and weaponization efforts—a demand firmly rejected by Iranian Foreign Minister Abbas Araghchi, who described uranium enrichment as “non-negotiable.”
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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