Stock market today: The domestic benchmark indices opened sharply higher on Monday, 25 May, after Brent crude prices slipped below $ 100 per barrel for the first time in over two weeks, boosting investor sentiment. The decline in oil prices came amid growing optimism over a potential agreement to end the Iran conflict, which could reopen the strategically important Strait of Hormuz.
US President Donald Trump said on Saturday that Washington and Iran had largely negotiated a framework for a peace deal that could restore shipping through the Strait, a key route that previously handled nearly one-fifth of global oil and LNG trade. Investors largely shrugged off Trump’s subsequent comments on Sunday that cautioned against expecting an immediate breakthrough.
Reflecting the improved risk appetite, Brent crude fell 5.6% to $97.8 per barrel, while broader Asian markets advanced 1.3%. Back home, the Nifty 50 climbed 0.94% to 23,941.85, while the BSE Sensex gained 1.02% to 76,194.32 as of 9:45 IST.
Market Outlook by Dharmesh Shah, Vice President, ICICI Securities
- Indian equity benchmarks recovered a portion of the previous week’s losses, as renewed optimism surrounding potential peace negotiations fueled the momentum in the market. The Nifty 50 gained 0.3% at 23,719.
- In the process, Midcaps continued with its relative outperformance by gaining 1.4%. Sectorally, IT, Realty outshone while consumption, PSU underwent profit booking.
- The index started the week on a positive note. However, lack of strength at higher levels resulted in the index confining within last week’s bear candle. Consequently, weekly price action formed a small bull candle with a higher low, indicating a pause in corrective bias.
- Over the past seven sessions, the index has been trading in a narrow range of 23,800-23,200. This tight-range price behaviour occurred while navigating geopolitical concerns, crude price volatility, shifting bond yields, and fluctuations in the USDINR pair. Ultimately, this prolonged sideways movement signifies a healthy consolidation process, effectively establishing a strong base for the next major leg upward.
- Going ahead, we expect the index to resolve out of the upper band of consolidation placed at 23,800, which coincides with the 20-day EMA, and resume upward momentum that can drive Nifty 50 towards 24,400 in the coming weeks.
- In the process, we expect bouts of volatility to remain elevated ahead of monthly expiry and ongoing earning season. Thereby, focus should be on accumulating quality stocks backed by strong earnings as strong support is placed at 23,200 being 61.80% retracement of previous move (22182-24601) and the price gap support from 7 April 2026.
- We expect broader market to relatively outperform the large caps as the ratio chart of Nifty 500 vs Nifty 100 has been inching upward, confirming sustained outperformance of the broader market backed by improving market breadth. Amidst geopolitical uncertainties, currently 72% of Nifty 500 stocks are trading above their 50 days SMA compared to last week’s reading of 68%.
Key Monitorable
- The Bernt crude oil has been forming a lower top formation over past ten weeks. The lack of follow through strength above $120, amid ongoing geopolitical conflict suggest that supply risk are fully priced in. negativity is already priced-in. Hence, a decisive close below $96 would confirm change in prevailing trend and result into extended correction.
- The pair of USD/INR approached the extreme overbought reading of 84 (highest since 2002). Further, Gravestone Doji candle on the weekly chart signifies, potential trend exhaustion and an impending reversal in favor of the Rupee.
- US and India GDP data.
Stock To Buy This Week – Dharmesh Shah
Dharmesh Shah of ICICI Securities recommends buying , and Bharat Heavy Electricals Ltd ().
Buy Tata Motors Passenger Vehicles in the range of ₹353-364. He has Tata Motors Passenger Vehicles share price target of ₹393 with a stop loss of ₹337.
Buy BHEL in the range of ₹400-409. He has BHEL share price target of ₹436 with a stop loss of ₹388.
Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 22/05/2026 or have no other financial interest and do not have any material conflict of interest.
The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.