Indian benchmark indices opened on a muted note on Monday after registering their longest weekly winning streak of 2026, as investors balanced optimism over renewed diplomatic engagement between the US and Iran against persistent geopolitical risks in the Middle East.
At 9:15 IST, the Nifty 50 was little changed at 24,061.75, while the BSE Sensex slipped 0.06% to 77,055.21.
Market breadth was mildly positive, with nine of the 16 sectoral indices trading in the green. The broader markets were subdued, with both the Nifty Midcap and Nifty Smallcap indices trading largely flat.
Asian equities declined by around 0.4%, while Brent crude rose by 0.6% as investors remained cautious amid renewed tensions in the Middle East.
Investor focus remains on developments between the US and Iran after diplomatic efforts resumed following several days of retaliatory strikes. The latest flare-up was triggered by an Iranian projectile strike on a cargo vessel in the Strait of Hormuz.
Although both countries have resumed diplomatic engagement, each has accused the other of breaching the interim ceasefire, keeping markets on edge over the possibility of further escalation and its potential impact on oil prices and global risk sentiment.
Market Outlook by Dharmesh Shah, Vice President, ICICI Securities
- Equity benchmark settled the volatile week on a flat note wherein it managed to settle above the psychological mark of 24,000. Nifty settled the truncated week at 24,056, up 0.2%. Midcap’s relatively underperformed (down 1%). Sectorally, BFSI, Auto, Realty, Pharma remained in limelight while Metal, Energy underperformed.
- The index started the week on a positive note and managed to close around the 100-day EMA (placed at 24,100), which has been acting as stiff resistance over the past four months. The weekly price action formed a “Doji-like candle” over second consecutive week, indicating heightened volatility around key levels.
- Going ahead, a decisive close and sustenance above 100 days EMA along with past two-weeks doji like candle’s high ~24,200 would result in continuation of upward momentum towards 24,800 in the month of July. Failure to do so, would result into prolongation of consolidation to prevail in the 24,200–23,600 range.
- Structurally, following a 1,100-point rally, the index has been stabilising within the range of its 50-day and 100-day EMAs. This healthy consolidation has helped cool off overbought conditions, eventually strengthening the market structure and establishing a solid base for the next leg of the upmove.
- The elongation of rallies followed by shallow retracement underscores underlying strength that makes us revise support base at 23,600. Hence, any decline should be used to accumulate quality stocks, as strong support holds at 23,600 being gap support dated 12 June 2026 coincided with 50% retracement of June rally (23,072-24,189).
Our Constructive bias is based on following observation:
a) Bank Nifty: After 3 months corrective phase, index closed above previous month’s high, confirming bullish reversal. Further, five years consolidation breakout on ratio chart of Bank Nifty vs Nifty 50 signifies outperformance going ahead. Expect Bank Nifty to head towards 60,000 in the near term
b) Mid/Small-Caps: Cup & Handle breakout on monthly chart of Midcap index augurs well for acceleration of upward momentum towards 70,000 (14% upside). While, 18 months falling trend line breakout in small cap index bodes well for catch up activity towards 22,600 (20% upside)
c) Easing of geopolitical tension: Re-opening of Strait of Hormuz has triggered a sharp correction in Brent Crude Oil prices which is trading at three months low ($73). The softening of base metal prices along with falling crude oil is expected to moderate inflation pressure. Thereby key beneficiaries like Auto, OMC, Paint, Aviation, Realty would be in focus going ahead.
Key Monitorable:
a) Auto Sales Numbers
b) FII Inflows: The extended profit booking in these AI led indices may help to shift the FII’s interest from AI trade to growth oriented emerging markets like India
c) US 10 Year Bond Yield: Retreated precisely from upper band of 3 years falling channel. Sustenance below 4.3% would provide highly supportive macro backdrop for emerging markets
Stock To Buy This Week – Dharmesh Shah
Dharmesh Shah of ICICI Securities recommends buying Kotak Mahindra Bank.
Buy Kotak Mahindra Bank in the range of ₹400-409. He has Kotak Mahindra Bank share price target of ₹448 with a stop loss of ₹372.
Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 25/06/2026 or have no other financial interest and do not have any material conflict of interest.
The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.
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