Dalal is likely to open higher on Thursday, extending a mild recovery after four sessions of heavy selling. However, investors are expected to remain cautious amid elevated crude oil prices, continued pressure on the rupee and uncertainty linked to the Middle East conflict.
GIFT Nifty futures were trading at 23,545 around 8:03 am IST, indicating that the Nifty 50 could open above Wednesday’s close of 23,412.60.
The and Nifty had ended marginally higher on Wednesday after losing nearly 4% over the previous four sessions. Markets had come under pressure due to rising oil prices, foreign investor selling and Prime Minister Narendra Modi’s recent call for fuel conservation and austerity amid the ongoing global energy shock.
Analysts said Wednesday’s rebound was more of a technical recovery after the recent sharp fall rather than a clear improvement in market sentiment.
“While there is some renewed buying interest after the sharp decline, the technical setup remains unchanged, with the currency continuing to remain under pressure from foreign capital outflows,” said Nandish Shah, Deputy Vice President at HDFC Securities.
The Indian rupee weakened to a fresh all-time low on Wednesday, highlighting the pressure from sustained foreign investor outflows and rising prices.
Foreign portfolio investors have sold Indian equities worth $23.22 billion so far in 2026, already crossing last year’s record annual outflows.
At the same time, Brent crude prices remained elevated near $106 per barrel as there was little progress in US-Iran negotiations.
Higher crude oil prices remain a major concern for India because the country imports most of its oil needs. Rising oil prices increase inflation risks, pressure the rupee and affect corporate earnings.
According to Aakash Shah, Technical Research Analyst at Choice Equity Broking Private Limited, global markets provided some support to sentiment ahead of Thursday’s opening.
“Indian equity markets are expected to open on a positive note, with Gift Nifty trading at 23,545, up by 125 points,” Shah said.
He noted that global equities moved higher after a largely upbeat session on Wall Street, where investors overlooked elevated US producer inflation data and continued buying technology and communication stocks.
Market participants are also closely tracking developments around the Trump-Xi summit, which could influence global sentiment further.
Despite the expected positive opening, technical indicators continue to suggest caution.
Aakash Shah said the Nifty 50 witnessed consolidation in the previous session after a sharp correction over the last three trading days.
“Caution persisted amid continued weakness in the rupee, elevated crude oil prices above the $100 per barrel mark, persistent FII selling, and rising volatility levels,” he said.
According to Shah, the Nifty formed a small-bodied bullish candle on the daily chart with a long upper shadow, indicating selling pressure at higher levels despite some buying support at lower zones.
He pointed out that the index continues to trade below all key moving averages while maintaining a lower high-lower low structure, which reflects weakness in the broader trend.
Analysts say the 23,400 level remains a crucial support zone for the Nifty.
Aakash Shah said sustaining above this level could help the index move towards the 23,600–23,700 range, while the important resistance remains near the 24,000 mark.
“A decisive move above 24,000 will be required for bulls to regain stronger control,” Shah said.
However, he warned that if the index fails to hold above 23,400, it could slip towards the 23,200–23,100 range in the coming sessions.
Derivatives data also indicates a cautious undertone in the market.
The Nifty Put-Call Ratio remained unchanged at 0.93 on May 13, showing balanced but cautious positioning by traders amid elevated volatility.
India VIX, often called the market fear gauge, rose for the fourth straight session to 19.43.
Shah said volatility remains elevated and confidence among bulls may improve only if VIX cools below the 17 mark.
Option chain data shows immediate support around the 23,400 strike, while strong resistance is visible between 23,600 and 24,000 due to aggressive call writing.
Banking stocks are also expected to remain under pressure.
The Nifty Bank index declined by 99 points in the previous session and continues to trade below key moving averages.
According to Shah, the banking index formed a small-bodied bearish candle with a long upper shadow, signalling selling pressure at higher levels.
Momentum indicators also remain weak.
The RSI stayed below the 40 mark at 38.99, while the MACD remained below both the signal and zero lines, indicating continued weakness in momentum.
Immediate support for Bank Nifty is placed around 52,777–52,666, while resistance is seen near 54,365–55,050.
“A sustained breakout above resistance levels will be required to improve sentiment in the banking space,” Shah said.
Overall, analysts believe markets may see a positive opening due to supportive global cues, but volatility is likely to remain high.
Persistent FII selling, elevated crude oil prices, rupee weakness and geopolitical uncertainty continue to keep investors cautious.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)