Nifty Holds Above Key Support as Bond Yields Ease, Inflows Improve Sentiment

Index Update: The Nifty 50 Index closed near 24,005.85 while remaining above its 50-day SMA around 23,832.68, indicating a stable medium-term technical structure. Recent price action reflects continued consolidation, with the index holding within a relatively narrow trading range following its recent recovery. The 14-day RSI stood at 55.13, suggesting balanced momentum without signalling overbought or oversold conditions. Immediate support is placed near 23,765.79 and 23,525.73, while resistance is seen around 24,245.91 and 24,485.97. A sustained move beyond these levels could provide greater clarity on the index's next directional move.

Macro Update: India's 10-year government bond yield fell to around 6.74%, its lowest in 15 weeks, supported by record foreign inflows after tax exemptions for overseas investors under the Fully Accessible Route (FAR). Strong bond demand, new FAR-eligible securities, and central bank FX intervention also aided sentiment, though global rate risks remain a key watchpoint.

Top Market Movers: On Wednesday, Eternal Limited (NSE:ETERNAL) led the gainers with a 5.71% increase, closing at INR 279.70 followed by Adani Enterprises Limited (NSE:ADANIENT) up 3.54% at INR 3,143.60 and Nestlé India Limited (NSE:NESTLEIND)  which rose 3.46% to INR 1,453.80. On the downside followed HCL Technologies Limited (NSE:HCLTECH) saw the largest drop, falling 3.51% to INR 1,034.20 followed Tech Mahindra Limited (NSE:TECHM) down 3.03% to INR 1,362.20 and Tata Consultancy Services Limited (NSE:TCS) which dropped 2.41% to INR 1,982.60.

Commodity Update: The U.S. dollar strengthened modestly on Wednesday after stronger-than-expected labor market data reinforced expectations that the Federal Reserve may keep interest rates elevated for longer, pushing U.S. Treasury yields higher. The Japanese yen remained near its weakest level against the U.S. dollar in around four decades. Gold declined 1.05% to USD 3,997.40 per ounce, silver dropped 2.55% to USD 58.39 per ounce, and copper eased 1.00% to USD 13,251.00 per metric ton. Brent crude oil gained 0.73% to USD 70.01 per barrel as uncertainty surrounding U.S.-Iran negotiations supported prices.

Our Stance: The market continues to exhibit a range-bound bias with a stable underlying technical structure. Softer bond yields and sustained foreign inflows provide near-term support, while global interest rate expectations and commodity price movements remain key external factors. A decisive breakout above resistance or below support could determine the market's next directional trend.

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