GIFT Nifty signaled a weak start for Dalal Street on Tuesday, falling 70 points in early trade. The drop comes after Indian benchmark indices snapped a two day losing streak in the previous session, powered by strong buying in banking stocks.
Traders are now watching global cues, foreign investor flows, and upcoming AI focused events that could shape the mood for tech stocks.
GIFT Nifty Signals Cautious Opening
GIFT Nifty was trading about 70 points lower in early trade, hinting at a soft opening for the Nifty 50.
The indicator often reflects how Indian markets may open, as it captures overnight global sentiment and institutional positioning.
On Monday, domestic indices ended higher after two sessions of losses. Banking stocks led the recovery, helping benchmarks close in the green despite mixed global cues.
Foreign portfolio investors remained net sellers, offloading shares worth Rs 972 crore in the cash market.
Domestic institutional investors, however, provided support. They were net buyers to the tune of Rs 1667 crore, helping cushion the impact of foreign outflows.
The tug of war between foreign selling and domestic buying remains a key theme for the market.
Banking Stocks Lift Market but Tech in Focus
Banking counters were the backbone of Monday’s rally.
Private banks saw steady buying as investors looked for stability amid global uncertainty.
However, market experts say the next big trigger may come from the technology sector.
An AI focused investor meet by Infosys and the ongoing India AI Impact Summit are expected to keep tech stocks in focus.
Investors are keen to hear management commentary on artificial intelligence, digital transformation, and revenue growth outlook.
Tech stocks have faced pressure in recent months due to global slowdown concerns. Any positive guidance linked to AI demand could shift sentiment quickly.
Why AI Matters for IT Stocks
Artificial intelligence is now central to the growth story of Indian IT firms.
Companies are investing heavily in AI tools, automation, and cloud services to stay competitive.
Here is what analysts are watching:
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New AI led deal wins
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Margin outlook amid rising investments
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Client spending trends in the US and Europe
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Hiring and cost control plans
A positive tone from management could provide short term relief to beaten down tech counters.
Key Levels to Watch on Nifty Today
Technical analysts say the Nifty’s movement around the 25,600 mark will be crucial for the near term trend.
If the index sustains above this level, it may attempt a gradual move higher.
If it slips below key support levels, traders could see renewed selling pressure.
Below is a quick technical snapshot:
| Level Type | Key Level |
|---|---|
| Immediate Support | 25,450 |
| Strong Support | 25,300 |
| Immediate Resistance | 25,700 |
| Major Resistance | 25,850 |
Short term traders are advised to maintain tight stop losses due to volatility.
Options data suggests heavy open interest around the 25,500 and 26,000 strike prices, indicating a possible range bound trade in the near term.
Analysts broadly expect a sideways market with a slight positive bias unless a strong global trigger emerges.
Global Cues and FII Flows Remain Critical
Asian markets traded mixed in early hours, tracking cautious moves on Wall Street.
Investors globally are assessing inflation trends, interest rate outlook, and geopolitical developments.
For Indian markets, foreign investor activity continues to be a decisive factor.
Sustained selling by foreign funds can weigh on sentiment, especially in large cap stocks.
On the other hand, steady domestic buying has emerged as a strong support system over the past year.
Retail participation through systematic investment plans has also helped absorb volatility.
What Could Move Markets Today
Market participants are closely tracking:
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Movement in US bond yields
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Crude oil prices
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Rupee against the dollar
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Corporate updates from large caps
Even small shifts in these variables can influence intraday direction.
Traders are also expected to keep an eye on sector rotation. If banking consolidates, technology or auto stocks may attempt to take the lead.
Strategy for Traders and Investors
For intraday traders, experts suggest focusing on stock specific action rather than aggressive index bets.
High beta sectors may see sharper swings, so disciplined risk management is essential.
Long term investors may use dips to accumulate quality stocks, especially in banking and select IT names.
Here is a simple approach many brokers recommend:
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Avoid heavy leverage in a volatile market
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Follow strict stop losses
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Track institutional flow data daily
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Focus on fundamentally strong companies
The broader trend remains intact as long as the Nifty holds above major support zones.
However, short term swings are likely to continue amid global uncertainty and heavy derivative positioning.
Markets appear to be entering a consolidation phase rather than a sharp directional move.
As GIFT Nifty points to a lower start, all eyes will be on how traders react in the first hour of trade. Will banking stocks continue to provide strength, or will tech counters take charge following AI related cues?
The coming sessions could set the tone for the rest of the week.
Investors should stay alert, manage risk wisely, and avoid emotional decisions in volatile conditions.
