Nifty 50 May Face Pressure, Target 29,000 by Year-End Amid Global Risks
Global economic headwinds continue to present significant risks for the Indian stock market, potentially keeping the benchmark Nifty 50 index near the 29,000 level by the end of the year, according to Rohit Srivastava, founder and market strategist at Indiacharts.com.
Market Struggles Amid Overheated Global Conditions
The Nifty 50 could be headed toward 29,000 due to persistent global challenges. While the index has shown resilience, many underlying stocks have begun to decline beneath the surface. Similarly, global markets have been overheated, with US indices breaking down from an ending diagonal pattern that typically signals important market tops.
After suffering losses for two consecutive months, the index has gained over one percent in February so far. The Nifty 50 hit a record high of 26,373.20 on January 5, but closed at 25,693.70 on February 6, representing a 2.6% decline from its peak.
Critical Resistance at All-Time High Levels
The January peak represents a crucial resistance level. Failure to surpass this high means the market may continue to face pressure at elevated levels. An ending diagonal pattern observed during the last quarter of 2025 marks an important stock market top for the coming year, according to Srivastava's analysis.
The Nifty 50 experienced sharp gains following the announcement of the India-US trade deal but has since failed to maintain altitude, remaining range-bound in recent trading sessions.
Potential Catalysts and Constraints for Growth
While factors such as a sharp reduction in interest rates and increased government capital expenditure could theoretically drive the index to the coveted 30,000 mark, Srivastava believes this scenario appears unlikely at present. "Increased government spending and dramatic interest rate cuts could get us to 30,000 quickly, but that would also endanger our bond and currency markets," he cautioned.
Sector-Specific Insights and Outlook
Srivastava expects the banking index to maintain relative strength. "Banks were the best performing sector of 2025, and it may be premature to say they will decline as much as the rest of the market. The sector was seen as having value and therefore can stay higher for longer."
Regarding specific opportunities, Srivastava identified the sugar sector as attractive due to its beaten-down value. "I would look for beaten-down value, and one such segment is sugar stocks. Sugar prices are at multi-year lows, and we could see the sugar cycle turn," he explained.
Currency Market Perspectives
For the USDINR pair, Srivastava views the 90 mark as important support. "If we do not go below 90, the rupee may weaken toward 98 in the coming year or two," he projected, highlighting potential currency market developments that could impact equity valuations.
The market strategist's analysis suggests investors should prepare for continued volatility and potential limitations on upside momentum as global economic conditions create headwinds for Indian equities.
