Indian benchmark indices were largely range-bound on Wednesday after two consecutive sessions of losses. The Sensex was up around 130 points in early trade, while the Nifty struggled to hold above 22,700. The market is attempting to stabilise after the recent sell-off, but foreign selling and high crude prices remain the key factors.

1. Crude Oil Remains Above $103

Crude oil continues to be a major driver for Indian equities. Brent crude rose around 1% to $103.50 a barrel after US President Donald Trump rejected reports that the US could ease sanctions on Iran. Continued uncertainty around the US-Iran conflict and the Strait of Hormuz is keeping oil prices elevated. For India, expensive crude can increase the import bill, pressure the rupee and add to inflation concerns.

2. Heavy FII Selling Continues

Foreign investors remain a major source of pressure on Dalal Street. FIIs sold Indian equities worth ₹9,980 crore on Tuesday, their biggest outflow in around four months. September’s FII selling has now reached about $2.7 billion, while year-to-date outflows stand at around $26.75 billion. Strong domestic buying is providing some support, but the foreign outflow remains a key headwind.

3. US Bond Yields Stay Elevated

US Treasury yields remain near multi-year highs, keeping global investors cautious. The US 10-year yield was around 5.29%, while the 30-year yield stood near 5.59%. Higher US yields can make dollar assets more attractive and increase pressure on emerging-market equities. Indian markets therefore remain sensitive to movements in US bond yields.

4. Asian Markets Provide Some Relief

Asian equities offered a positive signal on Wednesday. Japan’s Nikkei 225 gained around 1.4% in early trade, while South Korea’s Kospi and Kosdaq rose about 1% each. This has helped limit the downside in Indian markets after the sharp losses seen over the previous two sessions. However, gains remain vulnerable if oil prices or US yields rise further.

5. Rupee and RBI Remain Important

The rupee closed at 95.98 against the US dollar on Tuesday after touching a two-month low of 96.1475 earlier in the session. Oil prices remain an important factor for the currency, while suspected RBI intervention has helped limit the decline. A more stable rupee could provide some relief to equities, particularly if crude prices remain contained.

Key Technical Analysis

Sensex Technical Outlook

The Sensex is attempting to stabilise around 72,600 after falling nearly 1.8% over the previous two sessions. The 72,000-72,200 zone is an important support area, while 72,800-73,000 could act as the first resistance zone. A sustained move above 73,000 could improve short-term sentiment, while renewed selling below 72,000 would keep the broader trend weak.

Nifty 50 Technical Outlook

Nifty is hovering around 22,700 after recovering from Tuesday’s low. The 22,570-22,600 zone remains a crucial support area. A break below this level could open the way towards 22,400 and potentially lower levels. On the upside, 22,750-22,800 is the immediate resistance, followed by 23,000.

Bank Nifty Technical Outlook

Bank Nifty remains under pressure after falling below the 54,000 level during Tuesday’s session. The index needs to reclaim 54,900-55,000 to show signs of stronger recovery. On the downside, 54,200 and 53,800 are important support levels. Persistent weakness below 54,000 could keep banking stocks under pressure.

Today’s Key Takeaway

The market is trying to stabilise after a sharp two-session decline, with stronger Asian markets and some buying at lower levels providing support. However, crude above $103, elevated US Treasury yields and heavy FII selling continue to limit the recovery. Nifty’s ability to hold 22,570-22,600 will remain crucial, while a move above 22,800 could provide some relief to investors.

Tired of missing hot stocks? Tradz by EquityPandit provides powerful tools like stock scans and more help you make informed trading decisions. Download now and take control of your portfolio!