Stock markets are set to open significantly lower on Tuesday, following a global trend of weakness. On Monday, US stocks experienced a sharp decline amidst fears of a recession and uncertainties surrounding policy decisions. The Nifty is expected to open at 22,380, indicating a gap-down opening of 140 points for Nifty.
Major Asian markets are down by around 2 percent, adding to the negative sentiment in global markets.
Osho Krishnan, a Senior Analyst specializing in Technical & Derivatives at Angel One, commented on the challenging conditions ahead for the market, stating that global developments will continue to have a significant impact on the initial trends. In light of these uncertain circumstances, Krishnan emphasized the importance of implementing strong risk management strategies and avoiding aggressive trading practices to navigate the turbulent market effectively.
The depreciation of the rupee is expected to further fuel selling in the market, according to analysts.
Rahul Kalantri, VP Commodities at Mehta Equities, highlighted the rupee’s 41 paise decline against the US dollar on Monday, attributing it to increased demand for the greenback as a safe-haven asset amidst investor uncertainty. Kalantri also mentioned that ongoing negotiations for a bilateral trade agreement with the US contributed to market volatility. With consumer inflation data from India and the US set to be released soon, market participants are closely monitoring these developments for potential rate cut expectations by central banks. Kalantri anticipates continued volatility in the rupee, with a trading range of 86.90-87.70.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd, predicted that the market will remain range-bound in the absence of significant domestic triggers. Investors are advised to monitor global events such as US tariffs, geopolitical negotiations, and their impact on the US dollar and crude oil prices for guidance on market direction.
Despite the overall negative sentiment, some analysts believe that the market may see limited downside and attract buying interest at lower levels.
Emkay Global Research recently hosted 11 companies in 5 cities during its US Conference, facilitating approximately 100 investor meetings. The general outlook from management is cautiously optimistic, with expectations of growth and earnings moderating in recent quarters but bottoming out, leading to a gradual recovery in FY26. Emkay Global Research noted that investors are waiting for an end to earnings downgrades to turn positive, considering current valuations in Indian equities as attractive post-corrections.
Client Associates, a firm managing $6 billion, remains optimistic about long-term investment opportunities in Indian equities despite recent market corrections. They view the market as offering attractive valuations and benefiting from strong domestic support from institutional investors. Client Associates expects factors such as rural demand recovery, government investments, and favorable monetary policies to drive economic growth and market performance.
From a technical standpoint, the market is at a critical juncture, according to Ajit Mishra, SVP of Research at Religare Broking Ltd. Mishra emphasized the need for a fresh catalyst for the market to surpass the short-term resistance at the 20-day EMA of 22,700. Mixed global cues and underperformance of the banking index are identified as key obstacles. Mishra recommended maintaining a positive yet cautious approach, focusing on stock selection and risk management to navigate the current scenario.
The article was originally published on March 11, 2025.
