Mumbai, July 31, 2025: Dalal Street endured a volatile trading session as market participants digested the implications of U.S. President Donald Trump's imposition of a 25% tariff and punitive measures on India. The benchmark indices—Nifty 50 and Sensex—opened on a weak note, slipping nearly 1%, before staging a sharp intraday recovery to reclaim the 24,900 marks. However, renewed selling pressure in the final hour of trade dragged the indices back into negative territory.

The Nifty 50 ultimately settled with a cut of 86.70 points, or 0.35%, at 24,768.35. Sectoral breadth was broadly negative, with all major indices ending in the red barring the Nifty FMCG index, which bucked the trend and gained 1.3%. The outperformance in FMCG names was driven by defensive buying amid heightened volatility and upbeat commentary from sector heavyweight Hindustan Unilever.

On the flip side, high-beta sectors such as Nifty Metal, Nifty Oil & Gas, and Nifty Pharma bore the brunt of the sell-off, under pressure from global demand concerns exacerbated by the tariff announcement, as well as persistent margin compression. Broader markets mirrored the cautious sentiment, with the Nifty Midcap 100 and Nifty Small cap 100 indices declining around 1%. Risk-off sentiment prevailed, with investors rotating out of cyclical plays and into defensives, reflecting a flight to safety amid macroeconomic uncertainty.

Nifty Outlook

The index formed a bull candle with a long upper shadow highlighting intraday volatility amid continuation of the consolidation around the 100 days EMA. Volatility is anticipated to remain elevated in coming sessions driven by key macro triggers including the US- India tariff decision and the RBI rate decision. We foresee the index continuing to consolidate within a defined range of 24,500–25,000 over the near term.

On the downside, the 24,600–24,400 zone emerges as a critical demand area, marking a confluence of key technical levels — the prior swing low, the 100-day exponential moving average, and the 61.8% Fibonacci retracement of the recent up move from 23,935 to 25,669.

Bank Nifty Outlook

Bank Nifty formed a bull candle with a long lower shadow signaling consolidation amid stock specific action on the monthly F&O expiry. The index on Thursday session rebounded from the key support area of 55,500–55,000 region being the confluence of the 100-day EMA and key Fibonacci retracement levels of the prior up move—underscoring it as a high-probability demand zone. On the higher side key resistance is placed at 56,300-56,500 levels being the lower band of the recent breakdown area.  Overall, the index is likely to consolidate in the range of 55,000-56,400 in the coming sessions.

Attributed to Bajaj Broking