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Informist, Monday, Sept. 29, 2025

 

By Simran Rede

 

MUMBAI – Indian headline indices are likely to experience some more selling pressure Tuesday as investors are likely to remain cautious ahead of the expiry of Nifty 50's monthly derivatives contracts, continued FII selling, analysts said. Market participants also await the outcome of the Reserve Bank of India's monetary policy committee on Wednesday.

 

The central bank is expected to keep the rates unchanged for the second consecutive meeting Wednesday, analysts said. However, the RBI's projections on inflation will be closely tracked for cues on interest rate trajectory, Pravin Bokade, head of research at IDBI Capital Markets & Securities, said.

 

The GDP growth forecast will also be a key factor to monitor as analysts expect the RBI MPC to raise its FY26 GDP growth forecast on the back of supportive fiscal measures and a stronger demand outlook for Oct-Mar, Vinod Nair, head of research at Geojit Investments, said in a note. Ahead of the RBI's meeting outcome, banking stocks are likely to remain volatile, analysts said. 

 

The Nifty 50 settled at 24634.90 points, down 19.80 points, or 0.1%. The BSE Sensex closed at 80543.96 points, up 117.50 points, or 0.2%. The Nifty 50 fell for the seventh consecutive session while the Sensex snapped a six-day falling streak. Analysts expect limited upside in the Nifty 50 due to "continued call writing in out-of-the-money strikes". They don't expect the settlement of the monthly derivative contract for the Nifty 50 to be above the 25000 level. 

 

Technical analysts expect the Nifty 50 to find support at 24600–24500 points and face strong resistance at 24800 points. "It is difficult to predict the expiry levels, more or less 24800 points is crucial," Nandish Shah, senior derivative and technical analyst at HDFC Securities, said. Based on technical and derivative analysis, the index is likely to trade in a short-term range of 24500–24850 with volatility and a sideways-to-bearish undertone, analysts said.

 

Analysts believe the market is at an oversold position and a strong possibility of a quick pullback rally cannot be ruled out. "... market should recover a bit now for the next two to three months, but again it is going to come down," Bokade of IDBI Capital Markets & Securities said. He expects a two-percentage-point pickup in the Nifty 50 over the next two to three months, driven by earnings growth, the transmission of interest rate cuts, and GST rate reductions. However, Bokade said he is not optimistic about the market beyond this.

 

Indian corporate earnings growth is expected to be strong in the next couple of quarters, NDTV Profit said, quoting Ridham Desai, head of research and India equity strategist at Morgan Stanley. Desai expects the RBI to maintain its dovish stance, more reforms from the government, and a likely trade deal with the US. On Friday, HSBC Global Investment Research said the Indian stock market will "return to form" after its recent underperformance, driven by lower valuations, a slow recovery in earnings, and low positioning by foreign funds.

 

Despite the negative factors, the market has been holding on to gains on the back of domestic investments, and Bokade doesn't expect any sharp correction in the market going forward. Unless the growth in corporate earnings picks up, he doesn't expect foreign investments to come back to India. "FIIs are making good money in the market, like China, Taiwan, Brazil, and South Korea. They don't have an incentive to come back to India," Bokade said. For this, the market should either correct or earnings growth should improve, he said. 

 

On the GST rationalisation, Bokade does not expect the move to have a major impact on boosting consumption. "... larger consumption will happen only when there is a disposable income with the consumers. The disposable income will come to consumers when they have job growth when their salaries are rising and when they have confidence that my income will grow next year and that is not going to happen... (because) the economy is not creating jobs, manufacturing jobs are downwards, and you see IT (information technology sector) scenario is not very bullish," he said. The IT sector is likely to be impacted by the imposition of a $100,000 application fee for new H-1B visas.

 

Additionally, in West Asia, Israel launched offensives on the northern side of Gaza City, killing at least one person and injuring four others, Al Jazeera reported minutes before the market closed. This comes a day before the meeting between US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu at the White House. The future contracts of Brent Crude oil fell to a low of $69.01 a barrel, after having risen continuously for four sessions.  End

 

US$1 = INR 88.76

 

Edited by Saji George Titus

 

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