Indian benchmark indices, the Sensex and Nifty 50, are anticipated to open with a gap-up, signaled by positive trends in GIFT Nifty, indicating a favorable start for the broader domestic market.
This momentum follows a slightly positive close on Friday, where the Sensex rose 0.10 percent to 84,562.78 and the Nifty 50 added 0.12 percent to 25,910.05. However, this buoyancy is set against a backdrop of mixed global signals, with Asian markets showing mixed trading and Wall Street ending Friday’s session mixed as traders assessed the Federal Reserve’s evolving rate outlook.
The global macro environment is currently dominated by the strong U.S. Dollar and hawkish rhetoric from key Fed officials, which have dampened expectations for a December rate cut. Kansas City Fed President Jeff Schmid and Dallas Fed President Lorie Logan recently argued against additional rate cuts, citing persistent inflation risks and a resilient, though slowing, labor market. This stance contributed to a plunge in precious metals on Friday, with Spot Gold prices losing more than 2% and Silver prices declining almost 3.5%, pressured by the strong Dollar and rising U.S. treasury yields.
Despite the global caution, the domestic financial sector is expected to perform well due to overall positive earnings results. This optimism forms the basis for several positional trading calls.
Future Recommendations
Buy LUPIN (LUPIN LIMITED)
ICICI Direct recommends buying LUPIN in the range of ₹2,048–₹2,055 with a Target of ₹2,150 and a Stop Loss (SL) at ₹1,999.9.
The rationale centers on a potential breakout, as the stock has been consolidating between ₹1,900 and ₹2,050 since July. A noticeable pickup in delivery-based buying and the stock trading above its highest Call base, which is witnessing meaningful unwinding, are positive signs. Furthermore, Open Interest (OI) is near a five-month low, suggesting fresh OI buildup is likely on the long side.
Sell KALJEW (KALYAN JEWELLERS INDIA LIMITED)
The firm recommends selling KALJEW in the range of ₹493–₹495 with a Target of ₹464 and an SL at ₹510.1.
This sell call is based on underlying weakness, as Kalyan Jewellers continues to underperform the broader market. Futures OI has surged to 3.32 crore shares, marking its highest OI since its inclusion in the F&O segment, indicating aggressive short build-up. Aggressive Call writing, concentrated at the ₹510 Call, acts as major resistance, while the absence of meaningful Put writing suggests limited support at lower levels.
Sector and Market Watch
The Banking and Financials (BFSI) sector is in focus and expected to perform well, driven by overall positive results. This sector is highly sensitive to the strengthening US Dollar and Fed commentary, yet domestic fundamentals remain strong. Investors should note that SAIL is currently placed in the F&O ban list. Global uncertainties stemming from the data gaps due to the longest-ever US government shutdown will likely keep volatility elevated as traders await the official economic data releases.
