GIFT Nifty jumps over 300 points after oil price crash. What to expect on Monday?

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Indian markets are likely to see a positive opening on Monday after GIFT Nifty surged more than 300 points late Friday, tracking a steep decline in global crude oil prices and improving risk sentiment across global markets. The rally in GIFT Nifty comes after oil prices tumbled following easing geopolitical tensions in West Asia.

The sharp fall in crude prices could be the biggest catalyst for the spike in GIFT Nifty. Lower oil prices ease multiple macro pressures for India, including inflation, fiscal balance and currency stability.

Globally, sentiment turned positive after signs of de-escalation between the US and Iran, along with a temporary ceasefire between Israel and Lebanon. These developments have reduced fears of supply disruptions in key oil shipping routes, leading to a steep correction in crude prices.

US markets also reacted positively, with stocks opening higher on Friday. The Dow Jones Industrial Average gained around 1% in early trade.

Indian markets already showing strength

Earlier during the day, domestic equities closed on a strong note, with both Sensex and Nifty rising nearly 1%, supported by easing geopolitical concerns. Analysts pointed to the cooling of crude prices as a key tailwind.

Hariprasad K, Research Analyst at Livelong Wealth, noted that the easing of tensions in West Asia has improved global sentiment.

What to expect on Monday

With GIFT Nifty indicating a gap-up of over 300 points, the Nifty is likely to open well above the 24,300 mark, potentially testing key technical resistance levels early in the session. Technically, the immediate hurdle remains around the 50-day moving average near 24,410. A sustained move above this level could trigger further upside towards 24,700, according to market experts.

The broader structure of the market remains constructive. Analysts suggest a buy-on-dips strategy, with strong support now seen around the 24,000 zone.

Momentum indicators also remain favourable. The Relative Strength Index (RSI) continues to hold above the 55 mark, indicating underlying strength, while the India VIX has softened to around 17 levels. Lower volatility typically supports sustained market rallies.

Going ahead, crude oil prices will remain a key monitorable. Sustained softness in oil could further boost equities, especially sectors sensitive to input costs such as aviation, paints and consumption.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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