The Indian equity market faced a turbulent day on March 25, 2025, as the key indices, Sensex and Nifty, shed early gains amid profit booking and global trade concerns. The BSE Sensex experienced a significant drop, slipping 829.51 points or 1.06 percent from its intraday high to a low of 77,880.84 by noon, while the NSE Nifty followed suit, losing 242.05 points and closing at 23,627.55.
This downturn came despite a promising start that had analysts initially highlighting a bullish sentiment in the market. However, this optimism quickly dissipated as selling pressure in heavyweight stocks took hold, reflecting broader uncertainties in the global market. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, observed that “while market momentum still favours the bulls, the absence of strong fundamental support could limit further gains.”
Concerns surrounding potential shifts in global trade tariffs have added to the caution prevailing among investors. Vinit Bolinjkar, Head of Research at Ventura, pointed out that external factors, including these potential shifts in US monetary policy and ongoing geopolitical tensions, could introduce significant volatility. “While the market shows positive momentum, investors should remain cautious and factor in these external risks when making decisions,” he stated.
Despite the declines, not all analysts shared a pessimistic outlook. Ajit Mishra, SVP of Research at Religare Broking, argued that the recent market uptick was largely driven by renewed foreign institutional investor (FII) buying in the cash market coupled with short-covering in the derivatives segment. He noted that Nifty’s reclaiming of its 200-day DEMA (Daily Exponential Moving Average) reinforces positive sentiment, hinting that broad-based sectoral buying could support sustained momentum in the market.
Osho Krishan, Senior Research Analyst at Angel One, identified the 23,500 level as a crucial support area for the Nifty index. He remarked, “Immediate support at 23,510, backed by the 89-day DEMA and a recent bullish gap between 23,433 and 23,400, provides a cushion against further declines.” Krishan projected an intermediate resistance at 23,800, closely aligning with swing highs observed on February 25.
Hrishikesh Yedve, AVP of Technical and Derivatives Research at Asit C. Mehta Investment Intermediates, echoed similar sentiments, placing immediate support at 23,510 and short-term resistance at 23,810. “Traders should adopt a ‘buy on dips’ strategy, while low-risk participants ought to consider booking profits around the 23,800 mark,” he advised.
Moreover, Aditya Gaggar, Director at Progressive Shares, highlighted the formation of another bullish candle on the daily chart, indicating that the Nifty may be entering an overbought zone. “Immediate resistance at 23,800, along with key downside support at 23,400, presents critical levels for traders,” stated Gaggar, who suggested that a pullback might offer a healthy correction given the recent one-sided rally.
As analysts continue to assess the current market landscape, they recommend a cautious, yet opportunistic approach. With strong technical support around 23,500 and resistance pegged near 23,800, traders are encouraged to adopt a 'buy on dips' strategy while maintaining trailing stop losses. The prevailing external risks, including uncertainties surrounding trade tariffs and shifts in global monetary policies, could evoke short-term volatility, emphasizing the necessity for disciplined stock selection and profit-taking strategies in upcoming sessions.
In contrast, sentiments from the brokerage firm Bernstein suggested a silver lining for India's economy. The firm predicts India could benefit from a potential US recession due to the unique resilience of its economic trajectory, characterized by robust domestic drivers. Bernstein has reiterated its positive view on India's Nifty 50 and retains its year-end target of 26,500, suggesting an implied upside of 10.7% from the last close of 23,658.25 on the same day.
Venugopal Garre and Nikhil Arela of Bernstein noted that historically, India’s GDP growth tends to bottom out ahead of downturns in the US economy. They stated, “This time too, we believe with the weak September-quarter growth last year, India has bottomed out already.” They added that almost half of India’s export basket remains resilient to US economic downturns, hinting at potential stability amid global economic chaos.
The report concluded with an assessment of the market conditions. As the Nifty index continues to navigate through resistance, it remains crucial for traders and investors to remain vigilant, addressing both domestic and international challenges effectively. This careful approach will be vital to not just weather the current storm, but also to capitalize on emerging opportunities as they arise.
