Nifty Slips as IT Weakness Overshadows Financial and Metal Gains

Index Update: The Nifty 50 declined by 126.80 points (-0.52%) to close at 24,207.75 in the latest trading session, indicating mild near-term selling pressure. The index is currently trading marginally above its 51-day EMA at 24,195.57, which is acting as an immediate dynamic support level. Meanwhile, the RSI stands at 47.50 and remains below its moving average of 51.28, suggesting weakening momentum and a cautious near-term outlook. A sustained move above the 51-day EMA could help the index stabilise and attract buying interest, while a decisive break below this level may increase selling pressure and lead to further weakness.

Macro Update: Softer US sanctions on Iran eased inflation concerns, pushing domestic bond yields lower and supporting financial stocks. Metal shares gained on improving realisation prospects. Meanwhile, IT stocks declined after the US paused visa appointments amid an immigration crackdown, raising concerns over higher operating costs and margin pressure.

Top Market Movers: On Wednesday, Kotak Mahindra Bank Limited (NSE:KOTAKBANK) led the gainers with a 3.76% increase, closing at INR 416.70 followed by Axis Bank Limited (NSE:AXISBANK) up 1.62% at INR 1,255.00 JSW Steel Limited (NSE:JSWSTEEL) which rose 1.57% to INR 1,341.00. On the downside followed Bharti Airtel Limited (NSE:BHARTIARTL) saw the largest drop, falling 2.31% to INR 1,902.10 followed Power Grid Corporation of India Limited (NSE:POWERGRID) down 2.14% to INR 265.20 and Infosys Limited (NSE:INFY) which dropped 2.10% to INR 1,120.00.

Commodity Update: The U.S. dollar weakened as improved risk appetite, driven by lower oil prices and declining Treasury yields, reduced demand for the safe-haven currency. The Canadian dollar, meanwhile, recovered modestly after the previous session's decline as Ottawa responded to Washington with retaliatory tariffs. Gold advanced 0.40% to USD 4,713.31, while silver climbed 1.04% to USD 69.397 and copper rose 0.52% to USD 14,437.40. Brent crude fell 2.36% to USD 85.21, extending losses after reports emerged that the U.S. and Iran had reached a ceasefire agreement.

Our Stance: The near-term outlook remains cautious as weakening momentum and IT-sector pressure could limit upside. However, support from easing bond yields, strength in financials and metals, and the index holding near its 51-day EMA may provide stability. Sustained support above this level remains crucial for a potential recovery.

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