Nifty, Sensex, Nifty Bank outlook for today: GIFT Nifty down 200 pts; key levels to watch

Indian equity benchmark indices are set for another gap-down start on Friday on back of escalating geopolitical tensions in West Asia and a sharp surge in global crude oil prices. The renewed spike in energy costs has heightened concerns over inflation, prompting a rise in US Treasury yields and reinforcing a broader risk-off mood across global financial markets.

Indian equities are likely to remain under pressure in the near term as elevated crude oil prices remain a key overhang. Continued geopolitical tensions in West Asia, Brent crude oil prices hovering near a six-week high, weakness in the rupee and persistent FII selling are expected to keep investor sentiment cautious, 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 202.60 points, or 0.85 per cent, down at 23,671, hinting at a weak start for the domestic market on Friday. Asian shares fell on Friday as oil prices stormed back above $100 a barrel, rattling bond markets and reviving fears of a fresh inflation shock. KOSPI crashed 4 per cent, while Nikkei tanked 3 per cent. Hang Seng was down 1.5 per cent.

US stocks closed lower on Thursday amid concerns about heavy AI spending, soaring oil prices amped up inflation worries, and lifted bond yields. The Dow Jones Industrial Average fell 506.93 points, or 0.97 per cent, to 51,711.65, the S&P 500 lost 90.66 points, or 1.21 per cent, to 7,408.30 and the Nasdaq Composite cracked 553.21 points, or 2.15 per cent, to 25,137.69.
 

Crude, US dollar, gold & more
Brent crude held at $100.85 a barrel, after surging ‌7 per cent overnight to a two-month high of $102 as attacks by Iran-aligned Houthis on Saudi tankers in the Red Sea. Precious metals took a hit, with gold off 0.1 per cent at $4,043 an ounce. The higher Treasury yields helped the US dollar up generally, with the dollar index holding at 101.46.

Investor sentiment remained muted as Brent crude prices climbed following fresh attacks on oil tankers in the Red Sea, intensifying concerns over supply disruptions, said Ajit Mishra, SVP of Research at Religare Broking. "Given the mixed earnings outlook, elevated geopolitical risks, and persistent volatility, we continue to advocate a stock-specific approach while maintaining disciplined risk and position management."

FII-DII flows
Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 2,999.23 crore on Thursday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 2,947.14 crore on a net-net basis.

Nifty50, Sensex & India VIX outlook
The markets has formed a long bearish candle, which also indicates further weakness from the current levels. As long as the market is trading below 24,100/77,000, weak sentiment is likely to continue on the downside. The correction wave is likely to persist till the 50-day SMA or 23,850/76,000, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

"Further downside may also continue, which could drag the index to 23,750-23,700/75,700-75,500. On the flip side, above 24,100/77,000, the sentiment could change. Above this level, the market could bounce back to 24,200-24,250/77,300-77,500. The intraday market texture is uncertain and volatile; hence, level-based trading would be the ideal strategy for day traders," he said.

Immediate support for Sensex is placed near the 75,600–75,700 zone, and a break below this band could open the door for further downside. On the upside, resistance is seen in the 76,900–77,000 region, and the index would need a decisive close above this zone to ease the current pressure and stabilize sentiment, said Sachin Gupta, VP of Technical Research at Choice Equity Broking.

The market action signals weakness with volatility. Nifty is on the way down to the crucial supports of around 23,700-23,650. This is going to be a crucial base and there is a possibility of sizable bounce back from the lower supports in the near term. Immediate resistance is placed at 24,000 levels, said Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities.

On the Derivatives front, India VIX edged higher to 13.48, indicating that traders continue to factor in elevated volatility in the near-term, said Dhupesh Dhameja, Derivatives Research Analyst, SAMCO Securities.

Nifty Bank outlook
Momentum indicators continue to reflect weakness, with the daily RSI placed at 44.20 and trending lower, suggesting that bearish momentum is still prevalent and that the index may remain under pressure in the near term, said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities.

"Going forward, the 56,100-56,000 zone is expected to serve as a critical support area for Bank Nifty. A decisive and sustained break below 56,000 could intensify selling pressure and drag the index towards the 55,400 level. On the upside, the 56,900-57,000 zone is likely to act as a significant resistance hurdle. A sustained move above this range will be required to improve the near-term," he said.

Bank Nifty formed a bearish candle with a lower high and a lower low signaling continuation of the corrective decline for the fourth consecutive session in a row. A shallow retracement signals overall positive bias and a higher base formation in the current corrective decline, said Bajaj Broking Research.

"A follow through weakness below the support area of 56,200-56,500 levels being the confluence of the lower band of the last 6 weeks range and 52 weeks EMA will lead to acceleration of decline towards 55,500-55,000 levels. On the higher side 57,500 will act as an immediate hurdle while the upper band of the recent consolidation placed 58,500-58,700 will act as a stiff hurdle," it added.