The Nifty has been on a winning spree for the last five consecutive sessions. It has reclaimed and closed above the key support level of 24,000 on Monday. However, as the uncertainty around global markets continues and after the US President Donald Trump’s latest anti-Powell tirade, can Indian markets continue the uptick? All eyes will be on the Nifty.
Support for bulls?
Experts believe that India’s valuation has increased in the backdrop of the rally, but its fundamentals are strong with favourable Q4FY25 expectations and easing inflation continues to support the bull case. Akshay Chinchalkar, Head of Research, Axis Securities pointed out, “For now, the Nifty closed above the 200-day moving average on April 22 for the first time since the start of the year, and bulls will have to ensure a close above yesterday’s high to keep the rally going, with key support at 23872. Should that happen, the next upside target will be the 24000 – 24500 area.”
“While valuations have expanded in the wake of the rally, they remain meaningfully below historical peak multiples, indicating limited signs of froth,’ said Rohan Mandora, Analyst at Equirus Securities.
However, the volatility may persist as Wall Street remained shaky after Trump attacked Fed Chair Jerome Powell over rate cuts, which could weigh on along with US-China trade tensions.
Nifty: Technicals indicate higher highs
On the technical front, Samco Securities said that on the daily chart, “Nifty has broken out, above a falling trendline resistance that had capped its multiple rally attempts in the past. This breakout, supported by a strong bullish candle formation, confirms a positive shift in momentum. The pattern of higher highs and higher lows remains intact, reaffirming the ongoing uptrend.”
Furthermore, if uncertainty persists, the FIIs may again start chipping money into Indian equities as the dollar index slumps to a three-year low, said Vinod Nair, Head of Research at Geojit Investments.
“We expect positive momentum to continue in the market, supported by strong domestic cues with stock/sector specific movements on the back of ongoing Q4 earnings announcements,” Siddhartha Khemka, Head of Research and Wealth Management at Motilal Oswal Financial Services, reiterated the same idea.
However, “asset quality is expected to remain stable overall, though certain segments such as microfinance, unsecured business loans, and credit cards may continue to see elevated credit costs in Q4. We anticipate a more favourable environment for financials, supported by improving business momentum and macro tailwinds from H2FY26 onwards,” said Mandora.
All in all, the market experts are of the view that the domestic markets will sustain their positive momentum owing to fundamentals and Q4 earnings.