The domestic market is likely to open on a positive note due to a technical bounce-back after recent sharp sell-off. Unabated FPI selling and an underwhelming Q3 performance by some index heavyweights are likely to keep the market under pressure, said analysts. However, the focus will shift to the EU-India trade deal and upcoming Budget, they added.
Besides, US President Donald Trump’s soft tone on Greenland has lifted sentiment across the globe.
Ponmudi R, CEO of Enrich Money, said: The easing of trade and geopolitical concerns has lifted global risk appetite, triggering a rebound in risk assets and some profit-taking in safe-haven gold and silver. The improved global tone may help stabilise domestic markets after two sessions of sharp selling, though investors are likely to remain cautious.
“A strong US dollar and sustained FII selling remain key overhangs, while steady DII buying provides partial support, preventing a sharper downside. Earnings recovery has been slower than expected, and elevated valuations are undergoing a time-wise correction rather than a sharp price-led decline. The rupee slipping to fresh record lows near 91.69–91.72 against the dollar has intensified concerns around imported inflation and capital outflows. Meanwhile, India VIX has surged nearly 20 per cent over the last three sessions, reflecting rising uncertainty, driven by global macro risks, earnings volatility and currency pressure. While expectations around the Union Budget 2026 are gradually building around potential capex and policy support, near-term sentiment remains defensive and highly selective,” he added.
The derivatives market continues to send weak signals.
Dhupesh Dhameja, Derivatives Research Analyst, SAMCO Securities, said: Call writers have aggressively added fresh positions at at-the-money and nearby strikes, effectively capping near-term upside. On the other hand, Put writers have concentrated positions at lower strikes, suggesting expectations of a range-bound market with limited immediate downside. The Put–Call Ratio (PCR) has risen to 0.68 from 0.58, indicating elevated caution and continued dominance of call writers.
“Looking ahead, market participants will closely monitor FPI positioning, which remains in oversold territory, along with global developments — particularly political cues and rhetoric involving US President Donald Trump — as these factors could influence near-term sentiment and add to market volatility,” he said.