Nifty, Sensex, Nifty Bank outlook for today: GIFT Nifty down 66 points; key levels to watch

Indian equity benchmark indices may begin September's first trading session on a cautious note, caught between supportive domestic fundamentals and an unsettled global backdrop. Support GDP numbers come as a major trigger for the market but rising crude oil prices may sour the sentiments of traders.

Indian equities are likely to maintain a cautious bias as renewed US-Iran tensions and rising crude prices weigh on sentiment. Brent crude rose after fresh US strikes on Iran, reversing the easing and bringing inflation, the rupee and external balances back into focus. Investors will track India’s Q1FY27 GDP, auto sales and PMI readings, said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. 

GIFT Nifty, Asian markets & US stocks
GIFT Nifty Futures on the NSE International Exchange were 66.40 points, or 0.27 per cent, down at 24,185, hinting at a negative start for the domestic market on Tuesday. Asian stocks were seen lower in the early trade. Hang Seng lost over a per cent, while Nikkei and Hang Seng shed nearly half a per cent each.

US stocks weakened on Monday, with Wall Street turning the page on a volatile month as a war-related jump in crude prices revived inflation fears and raised the likelihood of tighter monetary policy. The Dow Jones Industrial Average fell 0.70 per cent to 53,185.90, the S&P 500 lost 0.33 per cent to 7,686.14 and the Nasdaq Composite shed 0.12 per cent to 26,370.89.

Crude, US dollar, gold & more
‌The 10-year US Treasury yield rose 2.2 basis points to a near 20-month top of 4.78 per cent. Brent crude futures topped $91 a barrel in morning trade in Asia. The dollar index eased to 99.37. Spot gold held its ground at $4,454.68 per ounce. Bitcoin was up 0.6 per cent close to $78,300 in the early trade.

The sell-off was triggered by a fresh escalation in the US-Iran conflict after US forces struck two Iranian launchers, driving a rebound in crude oil prices and reigniting inflation concerns, said Ajit Mishra, SVP of Research at Religare Broking. "Participants are advised to maintain a cautious stance, keep positions light and focus on strict risk management while adopting a selective trading approach."

FII-DII flows
Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 7,985.88 crore on Monday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 4,588.88 crore on a net-net basis.

Nifty50, Sensex & India VIX outlook
The short-term market outlook remains weak, but if the market manages to trade above 24,000/76,600, then a quick technical pullback from the current levels can be seen, said Shrikant Chouhan, Head of Equity Research at Kotak Securities. "It could bounce up to 24,200-24,300/77,300-77,500. However, below 24,000/76,600, selling pressure may accelerate. If it falls below this level, it could slip to 23,850-23,800/76,300-76,000."

Nifty50 found initial resistance around the recent low. However, the RSI has formed a positive divergence on the hourly chart, indicating a possibility of a near-term pullback. In the near term, the index may witness a minor pullback towards 24,180–24,200, said Rupak De, Senior Technical Analyst at LKP Securities.

"However, the higher levels are likely to act as resistance. A sustained move above 24,200 could trigger a further rise of around 100 points. On the downside, support is placed at 23,990. A sustained break below this level could resume the correction in the market," he said.

India VIX rose 4.78 per cent to 11.19, indicating a marginal increase in hedging activity and caution despite volatility remaining at relatively comfortable levels, said Dhupesh Dhameja, Derivatives Research Analyst at SAMCO Securities.

Nifty Bank outlook
Nifty Bank  formed a bullish candle with a lower low and a higher high signaling buying demand from the 50 days EMA. Within the consolidation, it is facing resistance around 58,000. It sustains above 58,000 will open upside towards 58,500-58.700. Failure to sustain above 58,000 will signal consolidation in the range 57,000-58,000 in the coming sessions, said Bajaj Broking Research.

Nifty Bank saw a sharp surge during the closing auction session (CAS) lifted the index significantly. It has remained range-bound over the past 19 trading sessions, oscillating within a band of approximately 1075 points, reflecting the absence of a clear directional trend, said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities.

"The technical setup continues to indicate a consolidation phase, with key momentum indicators and oscillators pointing towards a sideways market structure. Going forward, the 58,200-58,300 zone is likely to act as an immediate resistance area for the index. On the downside, the 57,500-57,400 zone remains an important support," he said.