Indian Stock Market Outlook: Sensex and Nifty Projections Amid US-Iran Tensions

Indian Stock Market Ends Holiday-Shortened Week on Strong Note

The Indian stock market wrapped up the holiday-shortened week on a strong note, marking a second consecutive week of gains. Optimism over a possible US-Iran peace deal supported confidence, while steady domestic fundamentals added to the positive momentum. Despite some bouts of volatility, the overall trend remained upward, with broader markets outperforming the benchmark indices.

As a result, both the Nifty and Sensex rose more than 1% each during the Friday session, ending at 24,353.55 and 78,493.54, respectively.

Market Outlook for Next Week

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According to Hariprasad K, a SEBI-registered Research Analyst and Founder of Livelong Wealth, Indian markets are poised to begin the upcoming week on a strong footing, supported by a decisive improvement in global risk sentiment following a meaningful easing of tensions in the Middle East. Late on Friday, after market hours, Iran's announcement that the Strait of Hormuz is "fully open" helped alleviate concerns over disruptions to global energy supply. This, alongside a ceasefire between Israel and Lebanon, has triggered a sharp risk-on move across global equity markets.

Sectoral Outlook

On the sectoral outlook, Hariprasad said that Technology stocks may continue their upward momentum, supported by strong global cues from the Nasdaq and improving risk appetite. Industrials and logistics companies are also well-positioned to benefit from easing supply chain concerns, particularly with the normalization of shipping routes through key global trade channels. Financials are likely to see positive sentiment as well, as declining uncertainty reduces systemic risk and supports credit growth expectations. On the other hand, energy and oil-linked stocks may face near-term pressure, with the sharp correction in crude prices likely to weigh on upstream realizations and earnings expectations.

Market Trading Strategy for Next Week

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Ajit Mishra, SVP, Research, Religare Broking, believes that investors should maintain a balanced and selective approach. Portfolio allocation may remain tilted towards fundamentally strong large-cap stocks, while selectively participating in broader market opportunities, given the improving sentiment alongside persistent global uncertainties. Mishra further recommended traders to maintain discipline, avoid excessive leverage, and focus on stock-specific opportunities.

Key Technical Levels to Watch for in the Coming Week

Sensex

The Sensex is currently trading near the 78,500 level, indicating stability after the recent recovery. Immediate resistance is placed in the 78,700-79,000 range, and a sustained move above this zone will be required to strengthen sentiment and push the index towards the 80,000 mark.

Nifty 50

The Nifty 50 continues to trade comfortably above its key moving averages—100-week and 200-week EMAs—thereby reinforcing the overall bullish trend and long-term structural strength. As long as Nifty holds above these levels, market sentiment is likely to remain positive and biased towards the upside. Immediate resistance is placed at 24,500, followed by 24,700 and 25,000, while on the downside, support is seen at 24,000 and then at 23,900.

Bank Nifty

In the near term, immediate downside support is placed in the 55,750-54,350 zone in case selling pressure re-emerges. On the upside, 57,100 acts as the immediate resistance, while 57,700 and 58,840 stand as the next key supply zones. A sustained close above 57,100 could signal strengthening bullish momentum and potentially trigger further recovery.