Indian equity markets are likely to open on a positive note on Thursday, supported by buying interest in banking and IT stocks, steady domestic institutional flows, and improving investor confidence. However, traders are expected to remain cautious as the U.S. Federal Reserve policy decision, crude oil prices, and global market movements could decide the near-term direction.
The domestic market has shown resilience despite global uncertainty, with investors focusing on corporate earnings, economic growth prospects, and sector-specific opportunities.
Global Cues Remain Mixed Ahead of Fed Decision
Global markets traded cautiously as investors awaited signals from the U.S. Federal Reserve on interest rates and future monetary policy. U.S. equities remained stable, supported by technology stocks, while European markets witnessed a mixed trend amid ongoing earnings updates.
Asian markets continued to face volatility after weakness in semiconductor stocks, although buying interest returned in select sectors. The GIFT Nifty indicated a mildly positive opening for Indian markets, pointing towards a firm start if global cues remain supportive.
Domestic Factors Continue to Support Market
Indian equities continue to benefit from strong domestic factors, including stable economic growth, healthy corporate earnings, and consistent participation from domestic investors.
The rupee remained relatively stable against the U.S. dollar, supported by foreign fund inflows and improving market sentiment. A stable currency environment has helped maintain confidence among investors, especially in export-oriented sectors.
Crude Oil Becomes the Biggest Concern
Rising crude oil prices remain a major risk for Indian markets. Higher Brent and WTI prices, driven by geopolitical tensions, have raised concerns over inflation and India's import bill.
A sustained increase in crude prices could put pressure on sectors such as oil marketing companies, aviation, chemicals, and transportation. Meanwhile, gold continues to attract demand as investors look for safer assets amid global uncertainty.
FII Buying Provides Support
Foreign Institutional Investors (FIIs) have shown renewed interest in Indian equities, while Domestic Institutional Investors (DIIs) continue to provide stability through regular market participation.
Analysts believe that institutional flows will remain an important factor in determining market direction. Traders will also track derivatives data, including Open Interest, Put-Call Ratio (PCR), Max Pain levels, and India VIX, for signs of changing market sentiment.
Banking and IT Remain Investor Favorites
Banking stocks continue to lead market momentum, supported by strong earnings, healthy credit growth, and improving asset quality. Large private banks remain among the preferred choices for institutional investors.
The IT sector has also witnessed renewed buying interest as investors focus on improving earnings visibility and expectations of stable technology spending globally.
Defence and capital goods companies remain in focus due to strong government spending, infrastructure development, and a healthy order pipeline.
On the other hand, metal stocks may face pressure due to global commodity price volatility, while oil and gas companies could remain vulnerable if crude prices continue to move higher.
Technical Outlook: Nifty Holds Positive Structure
The technical setup remains favourable, with Nifty 50 trading above key short-term moving averages. The index continues to maintain a positive trend, although volatility may increase around global events.
For the next session, Nifty has immediate support near 24,150, followed by 24,000. On the upside, resistance is expected around 24,350–24,500.
Bank Nifty remains strong with support near 56,000, while the resistance zone is placed around 56,700–57,000.
Stocks in Focus
Stocks likely to remain in focus include HDFC Bank, ICICI Bank, SBI, Infosys, TCS, Larsen & Toubro, BEL, HAL, Bharti Airtel, and Trent due to strong fundamentals, earnings visibility, and institutional interest.
Meanwhile, ONGC, IOC, BPCL, Hindalco, Tata Steel, JSW Steel, Vedanta, NMDC, and Coal India may remain sensitive to commodity price movements and changes in global risk appetite.
Aurelius Business View
Indian markets are entering the next trading session with a positive but cautious outlook. Strong domestic fundamentals, improving corporate earnings, and steady institutional participation continue to support the broader trend.
However, investors should keep an eye on global factors, especially the Federal Reserve's policy signals, crude oil prices, and geopolitical developments. In the current environment, selective buying in quality companies across banking, IT, defence, and capital goods sectors may offer better opportunities compared with broad market exposure.
Disclaimer:This article is for informational purposes only and should not be considered investment advice or a recommendation to buy or sell securities. Investors should conduct their own research and consult a SEBI-registered advisor before making investment decisions.
