Analysts warn of limited upside for markets unless FIIs turn net buyers.
Indian equity markets opened lower on Friday, with the Nifty index trading below 24,500 as concerns over tariff uncertainties weighed on investors’ sentiment.
At 09:40 a.m. IST, the Nifty 50 traded 104 points lower at 24,591, while the Sensex was down 350 points at 80,272. Broader markets too mirrored the weakness, with the Nifty Midcap and Smallcap indices falling over 0.3%.
Meanwhile, the retail sentiment on Stocktwits for Nifty remained ‘bullish’ amid ‘high’ message volumes.
Stock Watch
Sectorally, energy, media, PSU banks, and real estate saw some buying, while pharma, technology and consumer durables took a knock.
Bharti Airtel was the top Nifty loser with its shares falling over 2% following a large block deal.
AU Small Finance Bank rose 2% after securing an in-principle approval from the RBI to transition from a small finance bank to a universal bank.
In the earnings corner, Data Patterns fell over 7%, Kalyan Jewellers fell 5%, while BSE slipped 2% as the street parsed its June quarter earnings. On the other hand, LIC shares rose 4%, Kalpataru Projects and GDFC surged 7% on strong Q1 earnings.
Watch out for State Bank of India, Tata Motors, Grasim Industries, Siemens, Equitas Small Finance Bank, Lemon Tree Hotels, Manappuram Finance, Voltas, Wockhardt, among others, as they report quarterly earnings today.
Markets: The Road Ahead
From a technical standpoint, SEBI-registered analysts on Stocktwits shared the trade setup.
Varunkumar Patel noted that Foreign Institutional Investors (FIIs) sold around ₹5,000 crore worth of equities in the cash market. In the F&O segment, they added fresh index short positions despite heavy short covering in the previous session.
The MSCI, in its latest index rebalancing, has cut India’s weightage by about 2–2.5%, which could trigger an estimated $20–25 billion outflow. Patel believes nearly 70% of this selling has already been absorbed in the past month. And given the MSCI weightage cut and FIIs’ aggressive short positions, the probability of Nifty crossing 24,900 in the near term is low. A sustainable move above 24,900 is only likely if FIIs turn net buyers.
He advised traders to remain cautious and avoid getting trapped in fear-of-missing-out (FOMO) buying during short-covering rallies. One can look at aggressive positions only after the Nifty index clears the key 24,900 resistance.
Prabhat Mittal identified Nifty support at 24,480 with resistance at 24,820. For the Bank Nifty, he sees support at 55,200 and resistance at 56,000.
Arun Mantri cautioned that the Nifty index had to hold 24,400 (May lows) to carry the momentum. On the other hand, 24,800 is the stiff resistance for the near term. Overall, he expects the market to remain volatile with stock-specific action to continue. His outlook will turn bullish on markets only above 24,800, while any close below 24,400 will be very bearish for the market sentiments.
Stock Calls
Analyst Vinayak Gautam shared these stock recommendations for Friday.
Zydus Life: Buy at ₹944 for a target price of ₹985 with a stop loss at ₹930.
BSE: Buy at ₹2,442 for a target price of ₹2,650 with a stop loss at ₹2,340.
Kalyan Jewellers: Buy at ₹590 for a target price of ₹630 with a stop loss at ₹570.
Global Cues
Globally, Asian markets traded broadly lower, except for the Japanese markets, which rose after securing a trade deal with the U.S.. Crude oil prices are headed for the biggest weekly drop since June.
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