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Informist, Friday, Sept. 19, 2025

 

By Simran Rede

 

MUMBAI – Headline indices will likely continue to move in a range next week, with the bias being positive. With the Nifty 50 closing above 25300, analysts believe it is unlikely to fall sharply below 25000 points in the near term. They suggest a buy-on-dips strategy going ahead, which indicates that even if the index falls, investors should buy shares due to the possibility of further gains.

 

Market participants are looking for any positive developments in India's trade deal talks with the US and the European Union. However, there are concerns about the US revoking the sanctions waiver over Iran's Chabahar port. The move will impact India's plans to develop the port where a terminal is being developed by a public sector company of India. The country sees the port as an important project in context of regional trade and connectivity initiatives, according to media reports.

 

"While geopolitical and macroeconomic factors continue to be areas of concern, we believe that India being largely a domestic-oriented economy, will be able to weather the storm with limited impacts," Vinay Paharia, chief information officer at PGIM India Mutual Fund, said in a note. "Further, policy measures such as income tax and GST cuts and upcoming pay commission hike for central government employees, could increase disposable incomes and help consumption, which should augur well for overall economic growth."

 

The Nifty 50 Friday closed at 25327.05 points, down 96.55 points or 0.4%. The BSE Sensex ended at 82626.23 points, down 387.73 points or 0.5%. "Nifty 50's weekly close above 25150 points confirms a breakout, validating a bottom near 24400 points," Jigar Patel, senior manager of equity research at Anand Rathi Shares and Stock Brokers Ltd., said. The 50-stock index is expected to test 25500-25600 levels in the near term. Resistance for the index is seen at 25450–25650 points while support rests at 25150–25000 points.

 

Amid global trade tensions and domestic policy shifts, India's economic outlook remains balanced amid subdued market volatility and persistent uncertainties, Dhananjay Sinha, co-head of institutional equities at Systematix group, said in a report. "Elevated tariffs, weakening domestic demand, and India's shifting geopolitical alignments, particularly toward the China-Russia axis, coupled with prolonged US-India trade-tariff negotiations, are expected to sustain uncertainty, impacting foreign investment, private sector activity, and economic output," he said.

 

He believes domestic policy measures such as GST rate rationalisation will be critical in shaping the near-term economic trajectory given uncertainty regarding the outcome of US-India trade talks and a dovish decision by the US Federal Reserve. He expects the trade negotiations to eventually settle at a tariff in a 20-25% range on Indian goods, which is still significantly higher than the earlier level of 3%. "While the step down can be sentimentally positive, the elevated levels and a fragmented global trade will still be adverse for India's economic outlook," he said.

 

However, the reforms in goods and services tax are expected to revive demand and consumption as prices of mass consumption items decline. The impact of GST cuts is expected to be visible from the December quarter, while the September quarter earnings may take a hit due to deferred purchases on expectations of tax cuts and fall in inventory.  End

 

Edited by Ashish Shirke

 

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