Indian Markets Eye Recovery Amid Global and Domestic Cues

By Mandar in Indian Market Insights —

Indian Stock Market Outlook - August 4, 2025

The Indian stock market is poised for a positive opening today, August 4, 2025. Benchmark indices Sensex and Nifty 50 are expected to rise, supported by favorable indications from the GIFT Nifty index, which is trading near 24,670 levels. However, the market's overall sentiment remains cautious due to recent declines and global uncertainties.

Here's a breakdown of the key factors influencing the market:

Market Performance Review

  • The indices concluded the week with a negative trend for the second consecutive session.
  • On August 1, Nifty 50 closed below 24,600.
  • This marked a five-week losing streak, the longest in two years.
  • The downturn was mainly driven by widespread selling pressure.
  • Key sectors like pharma stocks saw significant weakness.
  • Midcap and smallcap indices underperformed.

Global markets have been experiencing a downturn, primarily due to:

  • Rising U.S. tariffs.
  • Disappointing U.S. jobs data.
  • This has spurred equity sell-offs.
  • Increased speculation about a Federal Reserve interest rate cut.
  • Asian markets are also facing headwinds, mirroring concerns over inflation and trade tensions.

Technical Analysis and Key Levels

The Nifty 50 is exhibiting bearish characteristics.

  • The market is showing lower lows and lower highs.
  • A drop below the 100-day exponential moving average could indicate further declines.
  • Key support levels to monitor are between 24,535 and 24,500.
  • A breach of these levels could trigger a sell-off towards 24,300-24,250.
  • Resistance levels are overhead, suggesting potential selling pressure on any rallies.

The Bank Nifty outlook:

  • The Bank Nifty must hold above 55,500 to aim for higher ranges between 56,100 and 56,200.
  • A decline below this level could push it towards its June low of 55,150.

Investment Strategy and Sector Focus

Investors should closely monitor the key technical levels and global developments.

  • Defensive sectors such as FMCG have demonstrated relative stability during this volatile period.

Overall Outlook

While the market is predicted to open with some gains, it faces challenges from both worldwide and domestic factors, prompting cautious trading strategies.