Stock market, Trump tariffs: Gift Nifty down 77 pts; levels for Nifty, Sensex & Nifty Bank

Indian benchmark indices are poised for a gap-down start on Thursday after the US imposed an additional 25 per cent tariff on exports from the South Asian nation, sparking investor concerns over the potential economic fallout from souring relations. The weekly expiry of F&O contracts may also add to the volatility at Dalal Street.

Nifty futures on the NSE International Exchange traded 76.90 points, or 0.31 per cent, down at 24,558, hinting at a negative start for the domestic market on Thursday. Asian stocks were mostly up on Thursday. Nikkei gained more than 0.70 per cent, while KOSPI rose 0.35 per cent. Hang Seng was seen flat.

This development is a part of ongoing global trade tensions and shouldn't distract from India's long-term growth potential. Near-term volatility is an opportunity for long-term investors, said Santosh Meena, Head of Research at Swastika Investmart. "Any significant correction should be seen as a buying opportunity, as earnings momentum is expected to improve from the next quarter onward."

US stocks ended higher on Wednesday as some companies delivered upbeat earnings reports. The Dow Jones Industrial Average rose 81.38 points, or 0.18 per cent, to 44,193.12, the S&P 500 gained 45.87 points, or 0.73 per cent, to 6,345.06 and the Nasdaq Composite jumped 252.87 points, or 1.21 per cent, to 21,169.42.

Oil prices rose on Thursday, pausing a five-day losing streak, on signs of steady demand in the US though the prospect of US-Russian talks on the Ukraine war eased concerns of supply disruptions from further sanctions. Brent crude futures rose 20 cents, or 0.3 per cent, to $67.09 a barrel while US West Texas Intermediate crude was at $64.57 a barrel, up 22 cents, or 0.3 per cent.

The dollar remained lower against major peers on Thursday. The dollar index edged up 0.1 per cent to 98.259 in early trade in Asia. On the domestic front, Indian rupee is expected to open largely unchanged on Thursday, showing limited reaction to U.S. President Donald Trump's additional tariffs on Indian goods.

With the policy behind us, focus will shift to earnings, FII flows, and global developments, said Vikram Kasat, Head of Advisory at PL Capital, expecting near-term consolidation with stock-specific action, while valuations in broader markets may trigger selective profit booking.

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 4,999.10 crore on Wednesday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 6,794.28 crore on a net-net basis.

The recent action reflects indecisiveness among market participants amid ongoing uncertainty surrounding tariffs and trade deals. Any negative surprise on this front could exert further pressure, said Ajit Mishra, SVP of Research at Religare Broking. "Participants should align their positions accordingly, with an emphasis on stock selection and risk management," he said.
 

Nifty & Sensex outlook

"We believe that the short-term market outlook is weak but oversold," said Shrikant Chouhan, Head of Equity Research at Kotak Securities. "On the downside, 24,500/80300 continues to be a promising support zone, while 24,700/81,000 would act as a crucial resistance area for the bulls. Above 24,700/81,000, the pullback is likely to continue up to 24,850–24,900/81,500-81,600," he said.

Nifty has consistently found resistance near 24,662 over the past several sessions, continuing its downtrend, said Nandish Shah, Deputy Vice President at HDFC Securities" It is on the verge of breaching the crucial support zone of 24473-24500. A break below this level would see the next support emerge near 24200, where the 200-day DEMA is positioned. On the upside, 24,800 is expected to offer short-term resistance, he said.

A sustained close below 24,500 could invite further profit booking toward the 24,200 zone in Nifty50, while resistance remains at 24,650– 24,800, said Reliance Securities. "It is showing signs of a potential lower high formation on the daily chart, which may indicate early signs of trend exhaustion unless bulls defend the 24,500 zone decisively," it said.
 

Nifty Bank outlook

Nifty Bank formed an Inside Bar candlestick pattern with a small bullish body and both upper and lower wicks, indicating indecision in the market and a tug-of-war between buyers and sellers at key levels, said Hardik Matalia, Derivative Analyst - Research at Choice Equity Broking.

"On the downside, immediate support is placed in the 55,200–55,000 zone. A breach below this range could invite further selling pressure and weaken the short-term structure. On the upside, immediate resistance is seen around 55,700, followed by a key hurdle near 56,000," he said.

Nifty Bank is underperforming relative to the frontline indices over the past few trading sessions. The 100-day EMA zone of 55,000-54,900 will act as immediate support for the index. Any sustainable move below the level of 54,900 will lead to further correction upto the 54,400 level, said SBI Securities. "While on the upside, the zone of 55,800-55,900 will act as a crucial hurdle."