Indian markets may see a soft start on Tuesday, May 13, after Monday’s euphoric rally that saw the Nifty close at a fresh 7-month high of 24,925. While optimism persists on the back of easing geopolitical tensions and strong institutional flows, cautious sentiment may return as investors await key macro data and corporate earnings.
GIFT Nifty indicates weak start
GIFT Nifty on NSE IX traded 160 points lower at 24,915 in early trade, signaling a negative opening for benchmark indices. The dip follows a sharp rally on Monday where Nifty surged 917 points, tracking positive global cues and cooling tensions between India and Pakistan.
Technical view: Nifty holds above critical level
On the charts, Nifty continues to trade comfortably above the crucial 24,350 mark, which now acts as a strong support. Analysts say as long as this level holds, dips are likely to be bought. On the upside, the index may attempt to scale towards 25,350 and even 25,750 in the short term.
India VIX cools off
The fear gauge India VIX dropped 14 per cent to 18.39, reflecting declining volatility expectations after the ceasefire. A sustained low VIX may support further upside in the near term.
All eyes on CPI data and Q4 earnings
Investors will closely monitor India’s retail inflation (CPI) data due later today, along with US Core CPI, which could provide clues on future rate actions by the Federal Reserve. Additionally, quarterly earnings from heavyweights like Bharti Airtel and Tata Motors are expected to influence sectoral action.
US markets rally; Asian peers follow
Wall Street ended sharply higher on Monday after the US and China agreed to temporarily reduce tariffs, boosting hopes of a resolution to their trade standoff.
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Dow Jones: +2.81%
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S&P 500: +3.26%
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Nasdaq: +4.35%
Asian markets echoed the rally:
Commodities update: Gold steady, oil cools off
Gold prices remained range-bound amid a shift to risk assets. Oil prices eased slightly after touching a two-week high, as markets digest the US-China tariff truce.
Dollar holds firm; rupee gains 34 paise
The dollar maintained strong levels as optimism around global trade improved. The rupee closed Monday at 85.37 per dollar, up 34 paise, aided by Asian currency strength and FPI inflows.
F&O ban list today
These counters remain in the F&O ban as they exceeded 95 per cent of market-wide position limits.
FII-DII activity: Strong institutional flows
FPIs turned net buyers on Monday, investing Rs 1,246 crore. Domestic institutions also continued their buying streak with net purchases worth Rs 1,448 crore, offering solid support to market sentiment.
With positive global cues and institutional inflows backing sentiment, the market remains in bullish territory. However, volatility around macro data and earnings could lead to some profit booking intraday. Keep an eye on 24,350 as the support pivot for the session.
