Nifty, Sensex, Nifty Bank outlook for today: Gift Nifty down 120 pts; key levels to watch

Indian equity benchmark indices are poised to open lower on Tuesday, as a spike in oil prices stemming from the ongoing Iran ​war dampens risk sentiment, while investors track corporate earnings. The broader momentum remains constrained due to the unresolved geopolitical tensions, particularly ​around the Strait of Hormuz as elevated oil prices are a headwind for India.

Nifty futures on the NSE International Exchange were 120.10 points, or 0.50 per cent, up at 24,000, hinting at a negative start for the domestic market on Tuesday. Asian stocks held near record ​highs on Tuesday but gave up gains later on. Nikkei and Hang Seng were down 0.60-0.75 per cent, while KOSPI inched higher.

Markets may maintain their gradual upmove, supported by hopes of a resolution, positive global cues and sector or stock-specific news flows driving broader market action, said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services. “Renewable energy, metals and mining stocks are likely to remain in focus, while summer-related plays may continue to benefit from demand.”

The US stocks ended mixed as investors took a breath at the top of an eventful week, with earnings, economic data, the US Fed’s ‌rate decision and the ebb and flow of Middle East tensions all crowding the docket. The Dow Jones Industrial Average fell 0.13 per cent to 49,168.04, the S&P 500 gained 0.12 per cent to 7,173.93 and the Nasdaq Composite rose 0.20 per cent to 24,887.10.

Brent crude futures edged up to $108.13 a barrel, near a three-week high. US West Texas Intermediate was at $96.48. Oil prices are well above the pre-war levels but have come down from their peak on hopes for a peace deal. Gold held steady on Tuesday as Spot gold was down 0.1 per cent at $4,679.06 per ounce.

The ​dollar benefited in March from safe-haven ⁠flows as the war erupted but shed most of those gains on hopes of a peace deal this month. It has steadied in recent days after US–Iran talks stalled. The dollar index was at 98.452.

Optimism around potential progress in US–Iran negotiations supported global sentiment, even as crude oil prices remained elevated, said Ajit Mishra, SVP of Research at Religare Broking. “We continue to advocate a stock-specific approach, focusing on sectors and themes showing strength while closely tracking earnings developments and geopolitical cues for further direction.”

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 1,151.48 crore on Monday. On the other hand, domestic institutional investors (DIIs) turned buyers of Indian equities to the tune of Rs 4,123.92 crore on a net-net basis.
 

Nifty50 & Sensex outlook

A bullish candle on daily charts and a reversal formation on intraday charts indicate that a pullback formation is likely to continue. For day traders, 24,000/77,000 and 23,900/76,700 would act as crucial support zones. As long as the market is trading above these levels, the bullish sentiment is likely to continue, said Shrikant Chouhan, Head of Equity Research at Kotak Securities.

“On the higher side, the index could move up to 24,215/77,700. Further upside may also persist, potentially lifting the index up to 24,300/78,000. On the flip side, below 23,900/76,700, the uptrend would become vulnerable. Under such circumstances, traders may prefer to exit their long positions,” he adds.

A long bull candle was formed on the daily chart that placed within the high low range of Friday’s long red candle. This is indicating a formation of inside day type candle pattern which signals possible comeback of bulls after a reasonable downward correction, said Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities.

“Bullish patterns like higher tops and bottoms have started to form on the daily chart and Friday’s swing low of 23,813 could be considered as a new higher bottom of the pattern. The short-term trend of Nifty seems to have turned up after a downward correction. The next upside levels to be watched are around 24,500-24,600 in the next few sessions. Immediate support is placed at 23,800,” he adds.
 

Nifty Bank outlook

Nifty Bank underperformed the frontline indices on Monday and continued to display indecisive price action. For the second consecutive session, it formed a small-bodied candle with shadows on both sides, indicating lack of clear direction, said Sudeep Shah, Head – Technical and Derivatives Research at SBI Securities.

“Looking ahead, the 200-day EMA placed in the 56,600–56,700 zone will act as a key resistance. A sustained move above 56,700 could propel the index towards the 57,200 level. On the downside, the 20-day EMA in the 55,700–55,600 range is likely to provide immediate support,” he said.

Nifty Bank formed a second consecutive high wave candlestick pattern with a higher high and a higher low signaling consolidation and buying demand emerging from 20 days EMA. It is witnessing consolidation in the broad range of 54,500-57,500 amid stock specific action on expected lines  as we progress through the quarterly earning session of the banking stocks, said Bajaj Broking.

“On the lower side a breach below last week’s low of 55,750 will open downside towards the 54,500 levels. From a short-term perspective, support is placed in the range of 54,500–54,000 zone, being the confluence of the recent low and 38.2 per cent retracement of the last 3 weeks pullback,” it adds.