Stock market today: Gift Nifty down 74 pts; key levels to watch for Nifty & Nifty Bank

Indian equity benchmarks are likely to open on a negative tone on Wednesday on caution due to US H-1B visa concerns, with persistent foreign outflows expected to neutralize prospects of a revival in consumption demand driven by the festive season. Traders also digest the cautious tone from the US Fed.

Nifty futures on the NSE International Exchange traded 74.30 points, or 0.29 per cent, down at 25,181.50, hinting at a negative start for the domestic market on Wednesday. Stocks in Asia fell on Wednesday, following declines on Wall Street. Nikkei dropped 0.35 per cent, while KOSPI dropped more than a per cent. Hang Seng edged marginally higher.

Globally, India-US trade talks continue to be in focus, said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. "Overall, we expect markets to remain firm, supported by a rebound in domestic demand driven by GST reforms and festive momentum."

US stocks finished lower on Tuesday, breaking a three-session string of record closing highs. The Dow Jones Industrial Average fell 88.76 points, or 0.19 per cent, to 46,292.78, the S&P 500 lost 36.83 points, or 0.55 per cent, to 6,656.92 and the Nasdaq Composite dropped 215.50 points, or 0.95 per cent, to 22,573.47.

In oil markets, Brent crude was last up 0.4 per cent at $67.87 per barrel, after a deal to resume exports from Iraq's Kurdistan stalled, pacifying some investor concerns. Gold was slightly lower after hitting a record high on Tuesday, with spot gold last down 0.2 per cent at $3,757.49 per ounce.

The US dollar edged up from its lowest level in close to a week on Wednesday. The US dollar index added 0.1 per cent to 97.335, after Federal Reserve Chair Jerome Powell struck a cautious tone on further easing overnight. US Treasury bonds attracted bids across the curve, with the yield on benchmark 10-year Treasury notes falling to 4.1061 per cent.

Optimism from recent GST reforms and festive demand continues to support sentiment, but external headwinds—visa-fee hikes, foreign outflows, and rupee weakness—are weighing in, said Ajit Mishra, SVP of Research at Religare Broking. "We recommend a cautious stance. Focus on sectors with relative strength, manage risk carefully, and avoid large directional bets."

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 3,551.19 crore on Tuesday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 2,670.87 crore on a net-net basis.
 

Nifty50 outlook

Nifty50 is trading above its crucial moving averages. Going ahead, the zone of 25270-25300 will act as an immediate hurdle for it. Any sustainable move above the level of 25300 will lead to a sharp upside rally upto the 25450 level, said Sudeep Shah, Head of Technical Research and Derivatives at SBI Securities. "On the downside, the zone of 25080-25050 will act as crucial support."

Despite the volatile price action, Nifty managed to hold above its previous swing high of 25,153 on a closing basis and maintained its position above the crucial 20 DEMA support level, which is currently placed at 25041, said Nandish Shah, Deputy Vice of President, HDFC Securities. "On the upside, the key resistance levels to watch for are 25,331 and 25,448," he said.
 

Nifty Bank outlook

Nifty Bank may extend the consolidation and trade in the range of 54,700-56,000. Immediate support is placed at 54,700-54,900 levels being the confluence of the last week low and 20 days EMA, said Bajaj Broking. "While key support is placed at 54,000 levels, being the key retracement of the entire decline. We maintain a positive bias," it added.

Bank Nifty mirrored the cautious tone, consolidating between 55,150–55,300 support and 55,700–55,800 resistance, said Ponmudi R, CEO of Enrich Money. "A breakout above 55,800 could set the stage for a move toward 56,000, while a slip below 55,450 risks a slide to 55,100. The outlook remains choppy yet balanced making selective buying above 55,600 the more prudent strategy."