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Informist, Monday, Sept. 1, 2025

 

By Gopika Balasubramanium

 

MUMBAI – Investors are likely to adopt a 'sell on rise' approach towards Indian stocks on Tuesday and the upcoming trading sessions, analysts said. The rise on Monday was more or less a kneejerk reaction towards the higher-than-expected growth in India's GDP in Apr-Jun, analysts said. The GST Council meeting, to be held on Wednesday and Thursday, during which proposed reforms are expected to be finalised, may give some comfort to the market. Further updates on meetings between leaders of India, China and Russia and their outcome would also be closely monitored by investorts. 

 

Currently, technical and derivative analysts see the 50-stock index falling to as low as 24000 points; last month, most of them were of the opinion that the benchmark index could touch 26000 points. Now these analysts see the 50-stock index rising to as much as 25500 points at best, even when large-caps are at an oversold zone, as some pointed out.

 

Investors are expected to be hesitant in making huge bets in Indian equities, especially at a time of such volatility in the rupee. On Monday, the currency hit a record intraday low of INR 88.33 a dollar and closed at INR 88.19. The falling rupee is also expected to drive away foreign investors who have already created "extreme" short positions in domestic equities, analysts said. In August, foreign investors sold Indian stocks worth INR 83.13 billion, the highest sell-off since February.      

 

"Today's move was more of a kneejerk reaction and it is too early to call it a recovery," said Ajit Mishra, head of technical research at Religare Broking. "Investors will be looking at opportunities to book some profits amid all the uncertainty with respect to tariffs and geopolitical developments," he said. Foreign investors are extremely short on the derivatives market, which indicates "bearish" sentiment for the near term, he added. "An earlier rollout of GST reforms, however, will favour the market," Mishra said. 

On Monday, the Nifty 50 closed at 24625.05 points, up 198.20 points or 0.8%. Only eight Nifty 50 constituents closed in the red. The BSE Sensex closed at 80364.49 points, up 554.84 points or 0.7%. Technical analysts expect the Nifty 50 to face resistance at 24800-24850 points and find support at 24500 points.

 

Investors will await any announcement from the recently concluded Shanghai Cooperation Organization Summit at which the leaders of India, China, and Russia were involved in discussions on trade and tariffs. This comes against the backdrop of India's strained ties with US post the latter's steep tariffs on Indian-made goods entering the US. The move is seen hurting specific sectors, especially textiles, gems and jewellery, and foods.  End

 

Edited by Avishek Dutta

 

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