Indian stock markets faced downward pressure on Wednesday as benchmark indices slipped amid persistent foreign investor selling. The Nifty 50 and Sensex both traded flat during morning hours but maintained a negative trend overall.
Market Performance and Key Levels
The Nifty 50 stood at 25,725.60 while Sensex traded at 83,572.07 as of 11:13 IST. Both indices have declined in six out of the last seven trading sessions, dropping 2.3% and 2.5% respectively over this period.
Market experts pointed to multiple concerns weighing on investor sentiment. Foreign portfolio investors continued their selling spree, adding pressure to domestic markets. International uncertainties including trade disputes and geopolitical tensions created additional headwinds for Indian stocks.
Technical Analysis and Market Outlook
Jay Thakkar, Vice President and Head of Derivatives and Quant Research at ICICI Securities, provided detailed technical insights. The Nifty 50 closed marginally negative after recovering from Monday's lows. Weekly expiry brought volatility, with the index moving between 25,800 and 25,600 levels before closing above 25,700.
According to Thakkar, the 25,700 level remains critical on a closing basis. Until the index closes above this level, bounces are likely as this zone previously acted as a demand area during the December series.
Options data indicates 25,800 to 26,000 forms a crucial resistance zone. This range contains the highest call base for the next weekly expiry. On the lower side, no significant put base exists until 25,000 levels. The broader Nifty range sits between 25,000 and 26,000, with a narrower range of 25,500 to 25,800.
The India VIX has trended upward recently and may stay elevated until the Union Budget session. Support exists at 10, while 13 to 13.50 levels could be tested on the upside.
Stock Recommendations from ICICI Securities
Jay Thakkar shared specific trading recommendations for the near term:
Tata Steel Futures: Buy in the range of ₹180-183 with a stop loss at ₹175 and targets of ₹190/193. The stock shows a higher high and higher low pattern with increasing open interest, indicating an upward short-term trend. Options chain analysis reveals significant put base from 180-170 strikes providing support, while 185 and 190 strikes have high call base.
Colgate Palmolive (India) Futures: Buy between ₹2,100-2,120 with a stop loss of ₹2,050 and targets of ₹2,200 and ₹2,260. The stock formed a short-term base with positive divergence in momentum indicators. High short buildup suggests potential bounce from short covering. The FMCG sector appears bullish near-term, offering defensive positioning during volatile periods.
Godrej Properties Futures: Sell in the range of ₹1,880-1,900 with a stop loss of ₹2,010 and target of ₹1,700. The stock broke down from sideways consolidation with increasing open interest indicating short buildup. Options chain shows 2,000 as critical resistance with highest call base, while 1,900 put base broke in the last session suggesting further weakness.
Sector Performance and Market Drivers
While overall markets faced pressure, metal shares rallied significantly. This sector benefited from increasing global metal prices, providing some positive momentum amid broader market declines.
Market participants remained cautious due to multiple factors. Rising crude oil prices added to inflation concerns. Trade disputes, particularly tariff threats from the United States, created uncertainty. Geopolitical issues further contributed to the risk-off sentiment.
The persistent selling by foreign portfolio investors has been a consistent pressure point for Indian markets. This trend has continued despite some domestic buying support.
Disclaimer: The Research Analyst or his relatives or ICICI Securities do not have actual/beneficial ownership of 1% or more securities of the subject companies. The views and recommendations provided in this analysis are those of individual analysts or broking companies. Investors should consult certified experts before making investment decisions as market conditions change rapidly.
