Indian stock market: After a phase of consolidation, Indian stock markets saw a significant downturn as rising geopolitical tensions between India and Pakistan heightened market volatility and prompted a move toward safer assets.

The Nifty 50 ended the week at 24,008.00, falling by 1.39%, while the BSE Sensex closed at 79,454.47, down 1.30%.

“The Nifty opened with a gap-down amid rising tensions between India and Pakistan, leading to a weak start and persistent pressure throughout the session. The index ended 1.1% lower at 24,008. Broader markets also slipped, with the Nifty Midcap100 and Smallcap100 falling 0.1% and 0.6%, respectively. Meanwhile, Foreign Institutional Investors (FIIs) continued their buying streak, with month-to-date inflows reaching ₹11,656 crore, offering some cushion to the market,” said Siddhartha Khemka, Head – Research, Wealth Management, Motilal Oswal Financial Services Ltd.

The major equity indices posted significant losses this week, largely due to rising geopolitical tensions between India and Pakistan amid reports of drone and missile strikes.

The market downturn deepened on the last trading day, following the Indian Army’s announcement of several overnight drone and munitions attacks by Pakistani forces, which fueled concerns of a potential escalation.

Key market drivers for next week

The coming week is expected to be crucial, driven by several important domestic factors. Geopolitical issues, especially the ongoing tensions with Pakistan, will remain in the spotlight.

On the economic front, investors will keep a close watch on key data releases, including the Consumer Price Index (CPI), Wholesale Price Index (WPI), and trade statistics for exports and imports.

Meanwhile, the corporate earnings season will gain momentum, with prominent companies such as PVR INOX, Tata Steel, Bharti Airtel, Cipla, GAIL, Hero MotoCorp, Tata Motors, Lupin, Godrej Industries, and BHEL set to report their quarterly results.

“Next week, the ongoing result season will further gain momentum as more than 350 companies including Tata Steel, UPL, Bharti, HAL, Tata Motors, Eicher, Tata Power, PB Fintech etc to declare their 4QFY25 results. India and USA CPI data will also be released on 12th and 13th May respectively,” said SBI report.

Technical outlook for next week

According to Ajit Mishra – SVP, Research, Religare Broking Ltd, the Nifty is currently hovering around key moving averages across various timeframes, suggesting the potential for further downside from a technical prospective.

Speaking on the Nifty outlook, Mishra said, “The immediate support is placed at 23,800, and a decisive break below this level could extend the decline toward 23,200. On the upside, any rebound is expected to encounter strong resistance in the 24,400–24,600 range.”

Meanwhile, on the Bank Nifty outlook, he added, “Meanwhile, the banking index is exhibiting relative weakness and may continue to underperform. It faces immediate support at 53,000, with a more robust support level near 52,400. Conversely, a sustained close above 55,000 could open the path for an upward move toward 56,000.”

Stock market trading strategy

Mishra further added that heightened geopolitical tensions have substantially increased market volatility, as evidenced by the spike in the India VIX.

“In this environment, investors are encouraged to adopt a stock-specific approach and avoid aggressive positioning until greater clarity emerges. Employing a hedged strategy is advisable to mitigate near-term risks, while close attention to geopolitical developments will be critical in determining the market’s direction moving forward,” he said.

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