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Informist, Wednesday, May 28, 2025

By Akash Mandal

MUMBAI – Benchmark equity indices are expected to keep consolidating Thursday ahead of the weekly expiry of derivatives contracts of the Nifty 50. Some analysts expect the 50-stock index to test 25000 points after the expiry, as the outlook for the near term remains positive. While a potential rate cut by the Reserve Bank of India at its June meeting has already been priced in by the market, expectations of a favourable trade deal with the US will continue to drive sentiment, analysts said.

Investors now eye minutes of the US Federal Reserve's latest policy meeting, due late Wednesday. The minutes will give insight on the views of the Fed's 12-member monetary policy panel on the health of the US economy, inflation, and the interest rate trajectory.

"The India VIX has been rising this week, which has kept gains limited despite the index looking positive on the charts," Brijesh Ail, head of technical and derivatives at IDBI Capital Markets & Securities, said. India VIX, the fear gauge of the Street, closed nearly 3% lower Wednesday but is still up nearly 9% over the last eight sessions. Ail was not sure why the indicator was rising as there has been no such negative news recently that would dent sentiment. However, he expects the Nifty 50 to rise to 25000 points after the weekly expiry and as the volatility reduces. 

Prashanth Tapse, senior vice-president of research at Mehta Equities, said the market was waiting for the US Federal Reserve's comments regarding inflation, interest rate trajectory, and the health of the economy in its June meeting. "The domestic data has been positive and the earnings have also not been as bad as the last quarter," Tapse said. He believes current valuations in the market are reasonable, while not being comfortable, after the sharp gains in the past two weeks. "No where else would investors get these sort of returns, a 6% GDP growth, and a stable economic environment," he said.

On Wednesday, the Nifty 50 ended at 24752.45 points, down 73.75 points or 0.3%, and the BSE Sensex closed at 81312.32 points, down 239.31 points or 0.3%. For Thursday, the 50-stock index is expected to find support at 24600 points and face resistance at 24800-25000 points.

On the earnings front, Bajaj Auto will detail its March quarter earnings Thursday. The automobile major's bottom line and top line are seen rising 4% on year in the reporting quarter. However, low volume growth and an adverse product mix are expected to weigh on the company's earnings, analysts said. Samvardhana Motherson International, Alkem Laboratories, Prestige Estates Projects, Mazagon Dock Shipbuilders, Suzlon Energy, and SJVN will also report their quarterly earnings on Thursday.  End

Edited by Avishek Dutta

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