Nifty traded with positive bias but later the index plunged in the red zone and touched the weekly low of 23,484.75. The positivity in the market at the start of the week was amid easing oil prices and almost plunging below $100 in Brent crude. However, sentiment turned cautious later mid fading hopes of quick geopolitical resolution, rising Middle East tensions, and persistent foreign fund outflows from Indian Market. For the month of May, FII made net sales of Rs 55,963.33 crores. And this is the 11th consecutive month of FII’s outflow. But selling intensified after MSCI index rebalancing took effect, amid concerns over geopolitical risks, crude oil volatility, and weaker monsoon expectations. Further investors also remained cautious, as the market is awaiting clarity on global developments before taking fresh directional positions.

Weather Forecast
India Meteorological Department (IMD) forecasted that India may receive about 90% of the long-period average rainfall this monsoon. This means a slightly below-normal season, if not a  severe shortfall. This may have a moderate impact on the Indian economy, particularly in agriculture, as rain-fed crop output could be affected.  Rural demand may also see some moderation if the farmers incomes are impacted amid lower yield. Nonetheless, the deviation from normal is not very large, the overall effect on GDP growth is expected to remain limited, amid continuous support by  services and industrial activity.

For the week ahead
Domestically, investors are processing new structural shifts after the UN nudged India’s 2026 growth forecast down to 6.4% from 6.6%, citing energy import strains from ongoing geopolitical friction in West Asia. The market will also be bracing for critical data releases, including April’s industrial production figures and the HSBC Manufacturing PMI, culminating in the RBI’s monetary policy announcement on June 5, 2026. Globally, key US labor metrics, specifically Non-Farm Payrolls, JOLTS job openings, and the unemployment rate, will provide crucial market direction. Closer to home, market participants will closely monitor the Rupee’s performance against the USD alongside FII (Foreign Institutional Investor) inflows and outflows.

NIFTY WEEKLY

Nifty 50 traded with positivity at the beginning,  but the index plunged to touch the low of 23,484.75, before settling at 23,547.75 down by 0.72%. But the index failed to sustain above the mark of 24,000. So, for further upside in the index, it must sustain above the key resistance of 23,800 and then 24,000. As the index failed to close above 23,800, it thus dampened the upside sentiment in the index. So, if the index fails to reach above 23,800, we may see the index falling to the low of 23,300-23,270.

BANK NIFTY WEEKLY

Bank Nifty went up to the high of 55,536.80, but later plunged to the low of 54,116.50. Bank Nifty managed to raise above the previous week’s high, but later in the week, the index plunged. On the technical front, the index took support at the level of 54,100 and managed to settle above this key support level. Thus, Bank Nifty can see further upside and reach for the upside level of 55,540. But if the banking index plunges below the mark of 54,100, we may see the index touching the lower level of 53.230.

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