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Informist, Friday, Jun. 20, 2025

By Akash Mandal

MUMBAI – The benchmark indices may extend their rally next week after the "surprising" gains made Friday, analysts said. While there is no specific trigger for the market currently, many analysts think foreign investors might be attracted to Indian equities as the domestic macroeconomic conditions are safer than the turbulent conditions seen elsewhere. Monday, the Nifty 50 is expected to move in a range of 25000-25200 points.

"It (Friday's rise) was a surprise, and was most likely driven by foreign inflows... the index has covered the last 5-6 days of fall in a single day," Jatin Gedia, technical research analyst at Mirae Asset Sharekhan, said. "Most importantly, the gains sustained till the end, which shows the strength of the market... the Nifty can now move towards 25175," he said. Gedia said he expects the market to be sideways to positive Monday.

Friday, the Nifty 50 ended at 25112.40 points, up 319.15 points or 1.3%. The BSE Sensex closed at 82408.17 points, up 1046.30 points or 1.3%. After a slow start, the indices surged in late morning trade and the Nifty 50 ended above 25000 points for the first time in seven sessions.

While analysts said the sentiment Monday will be positive, a lot will depend on events that take place over the weekend. Investors will keep an eye on developments in West Asia as the conflict between Israel and Iran has intensified. With the US threatening to get directly involved, some analysts believe crude oil prices may surge above the mark of $80 per barrel. If that happens, there will be a lot of pain in the market.

Iran has also threatened to close the Strait of Hormuz, which again would cause crude oil prices to shoot up. Most analysts, however, think this is highly unlikely, both for strategic reasons and because of doubts about Iran's ability to actually close the water body.

"Iran has never acted on its threat to close the Strait of Hormuz... this restraint reflects the strategic and economic calculus involved--the strait handles nearly 20% of global oil consumption and is vital for Qatar's LNG (liquefied natural gas) exports, Iran's own trade, and the energy trade of regional allies like Iraq," YES Securities said in a report Wednesday. "A full closure would not only trigger military retaliation, particularly from the US, but also damage Iran's economic interests and international standing."

The brokerage believes Brent crude oil prices are unlikely to sustain above $80 per barrel unless the Strait of Hormuz is closed or critical oil-related infrastructure is targeted as part of the conflict. At 1534 IST, the August contract of Brent Crude oil futures was down over 2% at $77.22 per barrel.  End

Edited by Rajeev Pai

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