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Informist, Wednesday, May 7, 2025

By Akash Mandal

MUMBAI – Benchmark equity indices will continue to consolidate for the remaining week as tensions between India and Pakistan are likely to keep investors on their toes, analysts said. Gains are likely to be capped Thursday until the Nifty 50 surpasses the 24500 levels convincingly, analysts said. Corporate earnings will also continue to influence the direction the market will take.

Investors will eye commentary from the US Federal Reserve, which will announce its decision on key interest rates at 2330 IST Wednesday. Commentary from the policy meet, the first since the US' imposed reciprocal tariffs, will provide cues on interest rates, inflation in the US, and economic growth.

"Commentary can be that Fed will like to take decision basis incoming data pertaining to inflation and jobs data...Street is expecting that any hint towards likely rate cut in June/July will be taken as positive cues," Sunny Agrawal, head of research at SBICAP Securities, said. According to the CME Fedwatch tool, there is an overwhelming 96% probability of the US Fed maintaining its status quo Wednesday.

The market is expected to move in a narrow range Thursday and gains are likely to be capped until tensions between India and Pakistan cool down, Prashanth Tapse, senior vice-president of research at Mehta Equities, said. "This retaliation was expected to happen sooner or later...volatility will remain based on action and reaction on Ind-Pak tensions," Tapse said.

On Wednesday, the Nifty 50 ended at 24414.40 points, up 34.80 points, or 0.1%, and the BSE Sensex closed at 80746.78 points, up 105.71 points, or 0.1%. Broader market indices ended the session 1-2% higher, recovering slightly from the sharp decline of 3-4% Tuesday. For Thursday, analysts pegged the support for the Nifty 50 at 24300-24000 points and the resistance at 24500-23600 points.

Three Nifty 50 companies will report their earnings for the March quarter Thursday--Titan Co., Larsen & Toubro, and Asian Paints. L&T is expected to report a 10% on-year jump in its consolidated net profit for the quarter, bucking the trend of subdued earnings by other engineering, procurement, and construction companies. The stock is expected to move in a range of INR 3,280-INR 3,375 Thursday, derivatives analysts said. Wednesday, the stock ended slightly lower at INR 3,321.40 on the NSE.

Titan's net profit is seen rising 4% on year, dragged down by a decline in the share of studded jewellery sales and higher operating expenses. Canara Bank, Pidilite Industries, Bharat Forge, Biocon, Escorts Kubota, and Kalyan Jewellers India will also report their March quarter earnings Thursday.  End

Edited by Deepshikha Bhardwaj

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