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Informist, Monday, May 5, 2025

By Akash Mandal

MUMBAI – Benchmark indices are likely to move in a narrow range Tuesday as they are in a consolidation phase, analysts said. Corporate earnings will continue to drive the market and investors will also keep monitoring the bubbling tensions between India and Pakistan for any negative shocks.

On Tuesday, the market is likely to stay flattish and will consolidate for the session, Anshul Jain, head of research at Lakshmishree Investment and Securities, said. "The Nifty (Nifty 50) is undergoing a swing low currently and is holding up...if the swing low breaks, there may be reversal in the negative direction," Jain said. "On Tuesday, the range is likely to be 70-80 points either side Monday's close."

On Monday, the Nifty 50 ended at 24461.15 points, up 114.45 points or 0.5%, and the BSE Sensex ended at 80796.84 points, up 294.85 points or 0.4%. For Tuesday, analysts pegged support for the Nifty 50 at 24000-23800 points and the resistance at around 24520 points.

While the Indian market remained resilient in April and outperformed other bourses, IDBI Capital Markets & Securities believes "at current valuation levels, the risk-reward profile appears less favorable for making aggressive equity allocations." In the absence of strong domestic catalysts and amid external policy risks, IDBI Capital expects the market to remain rangebound in the short term. The brokerage said it expects a more stock-specific trading environment.

A major positive for the Indian market has been foreign investors returning to Indian equities. After a sharp sell-off since January, FPIs have net bought Indian shares worth INR 401.47 billion over the last 12 sessions. With the rupee strengthening slowly against the dollar, foreign investors may be further attracted to Indian stocks. Monday, the rupee strengthened 39 paise to end at 84.25 against the dollar.

On the earnings front, investors will react to the March quarter earnings of Coforge. While the information technology major's bottom line for the quarter fell marginally short of the Street's estimate, its consolidated earnings before interest, taxes, depreciation, and amortisation margin rose 101 basis points on quarter to 18.7%. The executable order book for the next 12 months rose 48% on year to $1.51 billion as on Mar. 31.

Bank of Baroda and Godrej Consumer Products will report their earnings for the quarter Tuesday. Bank of Baroda's bottom line is likely to fall 3% on year due to low growth in net interest income. Godrej Consumer Products is likely to report a consolidated net profit of INR 4.9 billion for the quarter against a consolidated net loss of INR 18.9 billion a year ago. BSE, Hindustan Petroleum Corp., CG Power and Industrial Solutions, One 97 Communications, and Polycab India will also report their earnings for the quarter Tuesday.

Later in the week, investors will also eye the policy decision of the US Federal Reserve due Wednesday, which will provide insights into how the central bank views future US growth and inflation. The policy outcome will also provide clarity regarding the views of US Federal Reserve Chair Jerome Powell, who has been under increased scrutiny amid clashes with US President Donald Trump.  End

Edited by Ashish Shirke

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