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Informist, Monday, Jun. 16, 2025

By Simran Rede

MUMBAI – The benchmark indices are seen extending their gains Tuesday after short-covering by investors helped the indices close higher Monday. The Nifty 50 managed to close above 24900 points, which was pegged by analysts as a major resistance. Some analysts now say the index may test the 25200 level Tuesday.

"On daily charts, it (the Nifty 50) has formed a bullish candle and on intraday charts it is holding an uptrend continuation formation, which is broadly positive," Shrikant Chouhan, head of equity research at Kotak Securities, said in a note. "For day traders, buying on intraday dips and selling on rallies would be the ideal strategy," he added. Tuesday, the 50-stock index may move in a range of 24850-25200 points.

Monday, the Nifty 50 ended at 24946.50 points, up 227.90 points or 0.9%. The BSE Sensex closed at 81796.15 points, up 677.55 points or 0.8%. For Tuesday, analysts pegged the support for the Nifty 50 at 24850-24450 points and the resistance at 25200-25350 points.

While the underlying trend is bullish, some analysts expect the market to cool a little after the sharp gains in recent times. Emkay Global Financial Services expects the domestic market to take a breather after a 10% rally in the Nifty 50 since Apr. 9, when US President Donald Trump had announced a pause on reciprocal tariffs. While escalation of the conflict in west Asia is likely to trigger a selloff in the Indian market, the brokerage expects the spike in crude oil prices to be temporary and sees India's fundamentals being positive.

Analysts are also upbeat on corporate earnings for the June quarter and expect the huge leeway provided by the Reserve Bank of India at the outcome of the Monetary Policy Committee meeting Jun. 6, in the form of a 50 basis-point cut in the repo rate and a 100 bps cut in the cash reserve ratio, to likely boost consumption and improve corporate earnings from the September quarter. "The Q2 (Jul-Sept) earnings are likely to be in double digits, which will help the market to rise," Sunny Agrawal, head of fundamental equity research at SBICAPS Securities, said.

Emkay Global believes the earnings downgrade cycle has bottomed out and sees the possibility of upgrades going ahead. "The positive impact of the RBI easing and margin benefits from weak commodity prices are not captured in the FY26 forecasts," the brokerage said. "We maintain our FY26/FY27 Nifty EPS (earnings per share) forecast of (INR) 1,128/1,294, respectively," the report said.

The market is likely to consolidate for 3-6 months and investors are likely to focus on stock-specific actions, Agrawal of SBICAPS said. Additionally, the market has absorbed the widespread selling by foreign investors seen during the bear phase that lasted till April, he said. "Until the dollar index remains around 97-100, the market will witness buying," Agrawal said. At 1708 IST, the dollar index, which measures the strength of the dollar against a basket of six major currencies, was at 97.953, down from its previous close of 98.253.  End

Edited by Rajeev Pai

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