Stock market today: Gift Nifty down 213 points; key levels for Nifty, Nifty Bank ahead of RBI policy

Indian benchmark indices are staring for another volatile trading session on Wednesday, following an expected gap-down opening ahead of the monetary policy outcome from the Reserve Bank of India (RBI). Global markets continued to remain weak as the US signaled more tariffs on select sectors and trade war will China sent asset classes tumbling in the early session.

Nifty futures on the NSE International Exchange traded 213.35 points or 0.92 per cent down, at 22,417, hinting at a positive start for the domestic market on Wednesday. Major Asian indices opened lower on Wednesday tracking Wall Street’s overnight declines amid worries about slowing global growth.

In the Asian pack, Japan’s Nikkei tanked nearly 3 per cent, while Australia’s ASX200 fell a per cent. New Zealand’s DJ and South Korean KOSPI were down half a per cent in early trade. In the currency market, the US dollar lost ground to the safe-havens as the imminent imposition by the US of 104 per cent tariffs on China spooked world equity markets, sending Yuan to record lows.

The US reciprocal tariffs on India and other major economies have increased the risk of a global recession. This can lead to a decrease in India’s export earnings and create uncertainty in India’s growth trajectory, said Ajay Garg, CEO, SMC Global Securities.

Oil prices dropped to their lowest in more than four years in early trade on Wednesday on looming demand concerns fuelled by an escalating tariff war between the US and China, the world’s two biggest economies, and a rising supply outlook. Brent futures lost 3.39 per cent, to $60.69 a barrel, while US West Texas Intermediate crude futures fell 3.96 per cent to $57.22.

US stocks dropped on Tuesday for a fourth straight trading day since Trump’s tariffs announcement last week, with the S&P 500 closing below 5,000 for the first time in almost a year.  The Dow Jones Industrial Average fell 320.01 points, or 0.84 per cent, to close at 37,645.59, while the Nasdaq Composite lost 335.35 points, or 2.15 per cent, to end at 15,267.91.

Provisional data available with NSE suggest that FPIs turned net sellers of domestic stocks to the tune of Rs 4,994.24 crore on Tuesday. On the other hand, domestic institutional investors (DIIs) turned net buyers of Indian equities to the tune of Rs 3,097.24 crore.

Market is expected to remain volatile until things become clearer on the US tariff front, while stock specific action would continue on the back of upcoming Q4 earnings and management guidance, said  Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal Financial Services. “We suggest investors to avoid globally exposed sectors like IT, pharma and metals,” he said.

RBI policy expectation
The RBI’s six-member monetary policy committee (MPC) is likely to cut the repo rate by 25 basis points (bps) today as risks to growth rise in the aftermath of U.S. import tariffs, with investors closely monitoring its commentary and a potential change in stance from neutral to accommodative — for future policy clues.

With limited fiscal bandwidth, we expect a combination of liquidity measures and rate action by the RBI to support growth, said JM Financial. “The drag produced through the trade route will reflect a 20-40 bps lower growth projection by the RBI for FY26 while inflation expectation is unlikely to be tinkered with; the impact of the latest LPG price hike will be insignificant,” it said.

With inflation showing signs of stability and growth holding firm, the RBI is likely to strike a careful balance by staying watchful of global uncertainties yet clearly supportive of domestic momentum, Bharat Dhawan, Managing Partner at Forvis Mazars (India). “RBI may go for a 25-bps cut in the second half of 2025 as the focus gradually shifts toward reviving demands,” he said.

The Nifty50 outlook
The Nifty has witnessed a sharp pullback towards 22,500–22,600 which coincides with the key hourly moving averages, said Jatin Gedia, Technical Research Analyst at Mirae Asset Sharekhan. “We believe that trend pullback is likely to fizzle out and resume its downtrend towards 21,500-21,280 and hence this pullback should be considered as a selling opportunity,” he said.

A mild rebound followed on Tuesday, supported by a positive RSI divergence, suggesting a possible move toward the 22,950–23,000 zone, said Vatsal Bhuva, Technical Analyst at LKP Securities. “A breakout above 23,200 (20-week EMA) could confirm a bullish trend, while a close below 21,800 may signal further weakness,” he said.

Nifty Bank outlook
Nifty Bank has immediate resistance at 51,000 levels failure to move above the same post the policy outcome will signal consolidation in the range of 49,000-51,000, said Bajaj Broking. “Bank Nifty sustaining above 51,000 levels post the policy decision will lead to pullback towards 51,500 and 52,100 levels in the coming sessions, while 49,000-48,700 will act as immediate support.”

Hrishikesh Yedve, AVP Technical and Derivatives Research at Asit C. Mehta Investment Interrmediates said that the index crossed the hurdle of the 100-DEMA and formed a green candle, indicating strength. On the upside, the 50,750–50,800 zone will serve as a key resistance area. A sustained move above 50,800 could trigger a fresh rally, potentially taking it towards 51,500–52,000.