GIFT Nifty Drops 1.5% Amid US Market Plunge: Is Dalal Street Headed for a Monday Crash?
The Indian stock market is poised for a bearish opening on Monday, influenced predominantly by a significant decline in the GIFT Nifty, which fell by 1.52% overnight, equating to a loss of 356 points to close at 23,091. This downturn follows a sharp decline in U.S. equities, with the Nasdaq experiencing its most substantial one-day drop since April 2025, plummeting over 4% due to stronger-than-anticipated U.S. jobs data. The resultant increase in U.S. Treasury yields underscores a heightened concern regarding inflation and its implications on future interest rate hikes by the Federal Reserve. On Friday, domestic indices reflected this volatility, with the Sensex dipping by 117 points to 74,243 and Nifty down by 50 points to settle at 23,367.
Market analysts suggest that the Indian equity landscape may remain range-bound in the coming week amidst a blend of domestic and international factors. According to Siddhartha Khemka of Motilal Oswal Financial Services, while the Reserve Bank of India’s (RBI) initiatives to attract foreign capital and the recent tax exemptions for foreign investors in government securities present a favorable sentiment, the predominant market performance will hinge on stock-specific and sectoral developments. Concerns about elevated inflation—now projected at 5.1% for FY27—alongside a lowered GDP growth forecast of 6.6% for the same period, may curtail investor appetite and heighten caution about potential monetary policy adjustments by the RBI.
Rupak De, a Senior Technical Analyst, has noted that Nifty 50 is currently trapped within a consolidation range of 23,300 to 23,500 as it reacts to the RBI’s recent policy decision. The sustained trading below key moving averages and the weak Relative Strength Index (RSI) indicate a lack of bullish momentum in the index. Analysts project that a decisive breakout beyond the upper boundary of 23,500 could propel the market towards levels around 25,700; conversely, a fall below 23,300 could signify an impending sharp correction, thereby reinforcing the need for vigilant and strategic positioning among investors.
Source: The Economic Times
(Expert Note: This report was prepared by the Wealthova team.)