Nifty, Sensex, Nifty Bank outlook for today: Gift Nifty down 240 pts; key levels to watch

Indian equity benchmark indices are likely to open lower on Thursday, as Brent Crude prices topped $100 a barrel, after ​Iran seized two ships in the Strait of Hormuz, ‌ and with no signs of peace talks restarting. Overseas brokerage firm HSBC downgraded Indian equities ​to 'underweight' citing its reliance on imported energy and impact on inflation and domestic demand.

Nifty futures on the NSE International Exchange were 239.70 points, or 0.98 per cent, up at 24,141.50, hinting at a negative start for the domestic market on Thursday. Asian shares were mixed on Thursday as investors weighed in oil prices and focused on strong corporate earnings. Nikkei and Hang Seng dropped nearly a per cent each, while rose nearly one-fourth per cent.

Markets may remain highly sensitive to geopolitical developments and foreign investor activity. Foreign institutional investors have continued to sell despite occasional market recoveries, and their flows will remain an important factor.  said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. "The broader market may see stock- and sector-specific action," he adds.

US stocks climbed on Wednesday to send the S&P 500 and Nasdaq to closing records, after ​Donald Trump extended the ceasefire with Iran. The Dow Jones Industrial Average rose 340.65 points, or 0.69 per cent, to 49,490.03, the S&P 500 gained 73.89 points, or 1.05 per cent, to 7,137.90 and the Nasdaq Composite jumped 397.60 points, or 1.64 per cent, to 24,657.57.

Oil prices were marginally lower on Thursday after big gains in ‌the previous session amid the stalled peace talks between Iran and the United States, and as both nations maintained restrictions on the flow of trade through the Strait of Hormuz. Brent crude futures fell to $101.76 a barrel, while West Texas Intermediate futures shed to $92.82.

The ​dollar wobbled near a two-week high on Thursday as a standoff between Iran and the US ‌in the Middle East war and lack of progress in peace talks pulled oil prices back above $100 per barrel, weighing on investor sentiment. The US dollar index was at 98.644, near its highest level since April 13.

Renewed geopolitical concerns surrounding US–Iran developments kept crude oil prices elevated near the $100 mark, impacting overall sentiment. Profit booking after the recent multi-day rally also contributed to the downside pressure, said Ajit Mishra, SVP of Research at Religare Broking. "Participants should closely track sectors and themes showing rotational strength."

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 2,078.36 crore on Wednesday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 1,048.17 crore on a net-net basis.
 

Nifty50 & Sensex outlook

Technically, the market slipped below the 24,500/79,000 support zone after a gap-down open and throughout the day faced consistent selling pressure at higher levels. It has formed a small bearish candle on daily charts, indicating indecisiveness between the bulls and the bears, said Shrikant Chouhan, Head Equity Research at Kotak Securities.

"For day traders, as long as the market trades below 24,500/79,000, the weak sentiment is likely to continue. On the downside, it could slip to 24,300/78,200 further downside may also continue which could drag the index up to 24,200/78,000. On the flip side, above 24,500/79,000, it could retest levels of 24,600–24,675/79,300-79,500," he added.

Nifty50 Index continues to trade between its 50 and 100-day EMA on the daily chart. While near-term momentum appears subdued, the overall positional outlook stays positive. The bullish gap between 24100 and 23900 is likely to act as a crucial support zone, reinforcing the market’s underlying strength, said Osho Krishan, Chief Manager - Technical & Derivative Research, Angle One.

"We retain a constructive outlook, advocating a buy-on-dips strategy near the aforementioned support zones, provided the technical structure remains intact. However, participants should remain vigilant to global developments that could influence the intermediate trend, while maintaining a disciplined, stock-specific approach to navigate evolving market conditions," he said.
 

Nifty Bank outlook

Nifty Bank formed a high wave candle. Overall bias remains positive above last Wednesday's gap up area of 55,600-55,850. Index is expected to maintain positive bias and gradually head towards 57,800 and 58,500 levels being the previous breakdown area and key retracement of previous decline, said Bajaj Broking.

"Volatility is likely to remain high due to geopolitical tension and volatile crude oil prices. From a short-term perspective, support is placed in the range of 54,500–54,000 zone, being the confluence of the last week low and 38.2 per cent retracement of the last 3 weeks pullback. Forming higher high and higher low in weekly charts will keep the current pullback trend intact," it adds.

Nifty Bank attracted strong buying interest but upside remained capped. It has managed to close above these key moving averages for the second consecutive session, highlighting its relative outperformance versus the broader market, said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities.

"Going ahead, the immediate resistance for Bank Nifty is placed in the 57,500-57,600 zone. Any sustainable move above this zone could result in Bank Nifty extending its up move towards 58000, followed by 58,400 in the short term. On the downside, the zone of 56,600–56,500 zones is likely to act as an immediate support," he adds.