As the global market sentiment remains weak, India is bracing for a flat opening for Nifty and Sensex on Tuesday. Analysts predict that bears will continue to tighten their grip, particularly in the broader market where mid-cap and small-cap stocks are plummeting. The recent tariff threats from the new US administration and lackluster Q3 results from Indian companies have only added to the selling pressure.
Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services Ltd, expressed his insights on the current market situation. He mentioned that despite hopes of stability following BJP’s victory in the Delhi Assembly election, global concerns and foreign investor activity have overshadowed any positive impact. With the focus shifting back to Q3 earnings, corporate guidance, and global macro factors, the market is facing turbulence due to Trump’s trade policies.
According to Dhupesh Dhameja, a Derivatives Analyst at SAMCO Securities, the derivatives data reflects a bearish undertone. Call sellers are dominating put writers, indicating a resistance level between 23,400–23,800 strikes. Additionally, the declining Put-Call Ratio (PCR) suggests a gradual shift towards a bearish sentiment. Despite heightened volatility, the ‘Max Pain’ level at 23,500 implies limited downside in the market.
In light of the market’s weak structure and lackluster sentiment, Dhameja recommends a ‘Sell on Rise’ strategy to navigate the current conditions. While the US market closed strong, other equities across the Asia-Pacific region are down due to fresh tariffs imposed by Trump on aluminium products.
Elara Securities reported that India-dedicated funds have been steadily pulling out since the beginning of the year. This trend is part of a broader global pattern where inflows into the US markets have slowed down after a period of significant dollar unwind trade since October 2024. Foreign funds have been exiting various emerging markets, including India, but at a slower rate compared to others.
The total foreign fund redemption from India since October 2024 has reached $5.7 billion, with a significant portion of the pressure coming from dedicated funds. This marks the first time since 2021 that outflows from dedicated funds have accelerated, comprising nearly 70% of the total outflows in 2025.
In conclusion, the market is facing challenges both domestically and globally, with the impact of external factors like Trump’s policies and global sentiment influencing investor behavior. As India navigates these uncertainties, market participants are advised to adopt cautious strategies to mitigate risks and capitalize on emerging opportunities.
