The Indian equity market heads into Monday carrying the weight of a bruising week. Global signals are mixed, nerves remain visible, and traders are asking a simple question: is the worst priced in, or is there more pain ahead?
Global cues stay uneasy as nerves linger
Global markets are sending a mixed, slightly uncomfortable message as the new week begins.
US equity futures were down close to 0.5% early Monday, reflecting fresh geopolitical tensions that surfaced over the weekend. Those worries have kept risk appetite in check. Investors globally appear cautious, not panicked, but clearly unwilling to take big bets.
Asian markets, though, offered a counterbalance. Japan’s equity benchmarks pushed to fresh record highs during morning trade, a reminder that global risk sentiment isn’t collapsing across the board. China and other Asian indices were steady, suggesting selective optimism rather than broad fear.
Still, Indian markets tend to take their early cues from US futures, and that signal is not particularly comforting today.
GIFT NIFTY hints at a flat-to-weak opening
Early indicators suggest a muted start for Dalal Street.
GIFT NIFTY futures were trading about 21 points lower in early hours, pointing to a flat-to-slightly negative opening for Indian equities. After last week’s sell-off, that kind of opening may actually feel like a pause rather than a setback.
Traders are likely to test lower levels cautiously rather than rush into aggressive positions. A sharp gap-down looks unlikely for now, but sustained upside also appears capped in early trade.
This setup keeps the market in a wait-and-watch zone.
NIFTY50 comes off a rough week
Last week was uncomfortable for benchmark indices, especially NIFTY50.
The index ended the week with losses of around 2.4%. Fresh tariff-related concerns and comments from US officials hinting at delays in trade negotiations weighed heavily on sentiment. By Friday, risk-off mood was clearly visible.
Technical traders also noted that the index failed to hold key support zones, triggering follow-up selling.
Option data provides some clues about current positioning:
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Maximum call open interest is seen near the 26,000 strike
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Maximum put open interest sits around the 25,500 strike
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These levels are based on the January 13 expiry, considering strikes close to the current price
This suggests traders are expecting resistance near 26,000, while 25,500 could act as a near-term cushion. A decisive move beyond either level may set the tone for the next directional leg.
One thing is clear. Confidence took a hit last week.
Broader market shows early resilience
While the headline index struggled, the broader market quietly showed strength in early trade.
Both the Nifty Midcap 100 and Nifty Smallcap 100 were trading higher, rising around 0.60% and 0.52%, respectively. That divergence matters. It hints that selling pressure may be more index-heavy and driven by global cues rather than a full-blown domestic risk aversion.
Some traders see this as a sign of underlying strength. Others call it temporary and fragile.
Reality probably sits somewhere in between.
A lot will depend on whether midcaps and smallcaps can hold these gains as the session progresses, especially if large-cap stocks continue to feel pressure.
Earnings season now takes center stage
With macro worries swirling, attention is slowly shifting back to fundamentals.
The quarterly earnings season is about to pick up pace, and that could act as a stabilizing force. Strong numbers, or even results that meet expectations, may help calm nerves after a volatile start to the year.
Market participants will be closely watching management commentary, guidance, and demand trends. In an environment where global cues are noisy, company-specific signals may start driving stock-level moves more than index-wide sentiment.
This could also explain why broader markets are holding up better for now.
What traders may watch through the day
Monday’s session may not be about big moves. It may be about clues.
Traders are likely to watch a few key factors closely:
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Whether NIFTY50 can defend the 25,500 zone on dips
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How banks and heavyweight stocks behave in early trade
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Whether midcap and smallcap strength sustains beyond the opening hour
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Global cues through the day, especially US market direction
A sideways, choppy session would not be surprising given the setup.
Patience may matter more than prediction today.
