Indian Stock Market Plunges Sharply on Friday Session
The Indian stock market witnessed a dramatic reversal on Friday, finishing significantly lower after posting strong gains during the first half of the trading session. This sharp downturn was driven by a confluence of negative factors that rattled investor confidence across the board.
Key Factors Behind the Market Sell-Off
Several critical elements contributed to the bearish sentiment that gripped Dalal Street. Foreign Institutional Investor (FII) outflows continued to exert pressure, while weak Q3 earnings trends—particularly within the Information Technology (IT) and consumption sectors—raised concerns about corporate profitability. Additionally, the ongoing weakness in the Indian Rupee against major global currencies compounded the negative outlook. Renewed fears surrounding potential tariffs on NATO countries, including those proposed by former US President Donald Trump targeting Greenland, further dampened global risk appetite and spilled over into Indian markets.
Major Indices Register Significant Declines
The benchmark indices reflected the widespread selling pressure with substantial losses. The Nifty 50 index finished the day 241 points lower, closing at the 25,048 level. The BSE Sensex experienced an even steeper decline, crashing 769 points to settle at 81,537. The banking sector was not spared, as the Bank Nifty index nosedived a staggering 727 points, ending the session at 58,473.
Expert Analysis: Market Sentiment Remains Weak
Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, provided a detailed assessment of the market's technical posture. She highlighted that the overall sentiment is weak, noting that the Nifty 50 index has broken below the crucial 200-Day Exponential Moving Average (DEMA) support situated at the 25,100 level. This breakdown, coupled with an inability to sustain at higher price points, signals persistent selling pressure and a notable absence of follow-through buying interest.
Nifty 50 Outlook: Critical Support at 25,000 Zone
Elaborating on the Nifty 50's outlook, Parekh observed that the index formed a large bearish candlestick pattern on the daily chart, indicating heavy selling pressure influenced by weak global cues. The session concluded near its lows at approximately 25,050, maintaining a cautious and negative bias. She emphasized that the index now faces a psychological support zone near 25,000. A failure to hold this level could trigger intensified selling, potentially weakening the trend further and pushing the index toward the next significant support area around 24,400. For any meaningful recovery, Parekh stated that a decisive breach above the 25,500 level is essential to establish conviction and clarity for bullish momentum.
Bank Nifty Outlook: Breaks Below Key Moving Averages
Regarding the Bank Nifty, Parekh pointed out that the index has once again tanked below the important 50-period Exponential Moving Average (EMA) at the 59,000 zone, significantly weakening its bias. The formation of a substantial bearish candle on the daily chart led to a close near the session's low, breaking below the critical support at 58,800. The next major and crucial support for the Bank Nifty is positioned near the 200-period Moving Average at the 56,600 zone. On the upside, the index would require a decisive move past the 100-period MA at 59,500 to expect some stability and conviction in the coming trading days.
Parekh also outlined immediate technical levels: for the Nifty 50, support is located at 24,900 with resistance at 25,300. The Bank Nifty is anticipated to trade within a daily range of 58,000 to 59,000.
Vaishali Parekh's Intraday Stock Recommendations
For investors seeking trading opportunities, Vaishali Parekh recommended three stocks for intraday consideration on Friday. All recommendations are framed as buy ideas with specified entry, target, and stop-loss levels.
- Sanathan Textiles: Buy at ₹425, target ₹450, stop loss ₹415.
- Oracle Financial Services Software (OFSS): Buy at ₹7,850, target ₹8,200, stop loss ₹7,800.
- Lupin: Buy at ₹2,138, target ₹2,200, stop loss ₹2,090.
Disclaimer: This news article is intended for educational purposes only. The views and investment recommendations expressed herein are those of the individual analyst or broking firm and do not represent the stance of Mint. Investors are strongly advised to consult with certified financial experts and conduct their own due diligence before making any investment decisions.
