Market Overview and RBI Impact
The Indian stock market exhibited a cautious, range-bound movement on Friday. This subdued sentiment stemmed from investors processing the central bank's
decision to maintain interest rates unchanged, signaling a preference for economic stability. This stance was further reinforced by improved global trade prospects following recent adjustments to US tariffs. A notable positive development was the regulatory clarity from the RBI, permitting banks to lend to REITs, which enhances long-term funding accessibility for the real estate and credit sectors. Additionally, a slight recovery in the Indian rupee, supported by moderated corporate demand for dollars, helped alleviate immediate currency-related concerns, contributing to a more stable trading environment.
Precious Metals Surge
Gold and silver prices experienced an upward surge in international markets, opening with a gap-up. COMEX silver quickly climbed to an intraday high of $79.945/oz, marking a gain of over 3% shortly after the opening. Similarly, COMEX gold reached an intraday peak of $5,068.70/oz, reflecting an approximate 1.50% increase within the same timeframe. As of 6:25 AM, COMEX gold was trading at $5,043.50/oz and silver at $79.500/oz, both showing significant gains compared to their previous closing prices. Market expert Anuj Gupta suggests that gold and silver's near-term trajectory will be closely tied to the US Dollar's strength and ongoing US-Iran discussions. A stronger dollar is anticipated to cap precious metals' rally, while any weakness in the dollar is expected to fuel further price increases.
India-US Trade Deal Clarity
The recent interim trade pact between India and the US has brought much-needed clarity to the trade landscape, according to Sandeep Pandey, Co-founder of Basav Capital. This clarity is expected to benefit investors across the board, including Domestic Institutional Investors (DIIs), Foreign Institutional Investors (FIIs), and retail traders, by removing existing confusion. A significant implication of the deal is the potential reduction of India's reciprocal tariff on Russian crude oil imports from 25% to 18% once the agreement is fully implemented. Given that markets tend to anticipate such events, export-oriented sectors are anticipated to attract considerable investor interest on Monday. This positive outlook anticipates a gap-up opening on Dalal Street.
Rupee Outlook and FII/DII Activity
The Indian Rupee has been trading weaker, depreciating by approximately 35-40 paise. This weakness is attributed to the Reserve Bank of India's (RBI) decision to maintain status quo on interest rates and its neutral stance, which provided no fresh supportive triggers for the currency. With the US Dollar index hovering around 97.70, the near-term outlook for the rupee remains sideways, with an expected trading band between 90.00 and 91.25. In terms of foreign investment, FIIs turned net buyers on Friday, infusing ₹1,951 crore into Indian equities. Conversely, DIIs acted as net sellers, divesting shares worth ₹1,265 crore in the previous session. The forthcoming India-US trade deal is expected to further boost the rupee, benefiting export-driven sectors like auto, gems and jewellery, pharma, chemicals, defence, textiles, and IT due to anticipated tariff reductions.
Nifty 50 & Bank Nifty Forecast
Shrikant Chouhan, Head of Equity Research at Kotak Securities, suggests that while the intraday market texture for Nifty 50 appears weak, a significant selloff is only probable if the support level of 25,600 (or 83,200 for Sensex) is breached. A fall below these levels could see the market decline to the 25,500-25,350 range (or 83,000-82,500 for Sensex). Immediate resistance is anticipated around 25,800 (or 83,800 for Sensex), with potential upside movement to 25,900-25,925 (or 84,000-84,200 for Sensex) if this resistance is overcome. Meanwhile, the Bank Nifty is showing underlying strength, consolidating above its trendline breakout and sustaining above its 20-day moving average. Momentum indicators also suggest a bullish outlook. A buy-on-dips strategy is advised if the index remains above the crucial 59,500 mark, with immediate support at 59,800 and resistance at 60,800.
Five Stocks to Watch
Market experts have identified five stocks with potential for intraday trading on Monday. Sumeet Bagadia recommends Torrent Power, suggesting a buy at ₹1429 with a target of ₹1530 and a stop loss at ₹1377. The stock exhibits a bullish reversal pattern and a higher high-higher low structure. He also suggests Jindal Steel, with a buy at ₹1189.90, target of ₹1275, and stop loss at ₹1347, noting a strong bullish setup after a consolidation phase and a Cup-and-Handle pattern breakout. Ganesh Dongre advises buying ITC at ₹326, targeting ₹342 with a stop loss at ₹314, citing a consistent bullish pattern and strong support at ₹314. Bharti Airtel is also recommended for a buy at ₹2038, with a target of ₹2100 and stop loss at ₹2010, showcasing a continuous bullish pattern. Lastly, Kotak Mahindra Bank is suggested for a buy at ₹422, targeting ₹460 and a stop loss at ₹410, also exhibiting a strong bullish pattern.
