Indian stock market benchmark indices are expected to witness a tepid opening on Friday, despite positive momentum in global markets as geopolitical tensions appear to be easing. The Gift Nifty, trading around the 25,345 level, indicates a muted start with a discount of nearly 4 points from the Nifty futures' previous close.

Thursday's Market Performance

The Indian stock market successfully broke its three-session losing streak on Thursday, with both major indices posting gains. The market performance demonstrated resilience amid ongoing volatility concerns.

Technical Analysis and Market Outlook

Sensex Technical Levels

According to Shrikant Chouhan, Head Equity Research at Kotak Securities, the Sensex has formed back-to-back indecisive patterns, which may keep the market volatile within a broader trading range. Traders are advised to exercise caution while trading at resistance and support levels due to intraday market volatility.

Nifty 50 Analysis

The Nifty 50 index formed a high-wave candle pattern, indicating significant market indecision with substantial activity on both sides. Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, noted that the index formed a small red candle with upper and lower shadows, signaling heightened volatility.

Key technical observations include:

• The crucial 200-day EMA support was regained on Thursday
• Nifty 50 closed above the 200-day EMA level
• Overall near-term trend remains weak, but short-term bounce is developing
• Sustainable move above ₹25,500 could confirm near-term bottom reversal

Derivatives and Options Data

Derivatives data reveals heavy call writing at the 25,400 strike and significant put writing at the 25,200 strike, establishing this range as a key near-term pivot. Hitesh Tailor, Research Analyst at Choice Equity Broking, advises traders to remain cautious near key support levels and wait for confirmed breakout above resistance before taking fresh directional positions.

Bank Nifty Technical Outlook

The Bank Nifty index demonstrated strong performance, rallying 399.80 points to close at ₹59,200.10, forming a classical doji pattern on the daily chart. This indicates market indecision following the recent sell-off. Sudeep Shah, Head - Technical and Derivatives Research at SBI Securities, highlighted that the index has decisively moved above its 50-day EMA, indicating strengthening short-term momentum.

Ponmudi R, CEO of Enrich Money, observed that price action remains confined within a short-term rising channel, indicating consolidation rather than trend initiation. The momentum remains neutral with RSI hovering in the mid-50 zone, reflecting absence of strong directional conviction.

Market Volatility Indicators

The India VIX cooled off towards the 13 level, and further decline would be conducive to sustaining positive sentiment. This volatility measure suggests reduced market anxiety compared to previous sessions, though analysts expect some consolidation before stronger directional moves emerge.

Indian benchmark indices Sensex and Nifty 50 are expected to open higher on Friday, following a rally in global markets as geopolitical tensions and concerns over US President Donald Trump's Greenland tariffs eased. The positive sentiment comes after Asian markets traded higher and US stocks gained overnight as Trump reversed Greenland tariff threats on European allies.

Thursday's Market Performance

On Thursday, the Indian stock market ended higher, snapping its three-session losing streak on signs of easing global geopolitical tensions. The market performance showed strong recovery across both major indices.

"Overall, we expect markets to track global cues, macro indicators and the ongoing quarterly earnings," said Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd.

Global Market Indicators

Asian Markets Performance: Asian markets traded higher on Friday, following the overnight rally on Wall Street as geopolitical tensions eased, ahead of the Bank of Japan's interest rate decision.

Hong Kong Hang Seng index futures indicated a higher opening, adding to the positive regional sentiment.

Gift Nifty Signal: Gift Nifty was trading around the 25,380 level, showing a premium of nearly 30 points from the Nifty futures' previous close, indicating a positive start for Indian stock market indices.

US Market and Economic Data

Wall Street Performance: US stock markets ended higher on Thursday after President Donald Trump rescinded Greenland tariff threats on European allies.

Key Stock Movements:

• Meta share price rallied 5.70%
• Tesla stock price jumped 4.20%
• Nvidia shares rose 0.85%
• Microsoft share price gained 1.52%
• Procter & Gamble stock price advanced 2.60%
• Abbott shares plunged 10.00%
• GE Aerospace slipped 7.40%

Economic Indicators

US GDP Growth: The US economy grew faster than initially estimated in the third quarter. US GDP increased at an upwardly revised 4.40% annualized rate, the fastest pace since the third quarter of 2023. Economists had forecast GDP would remain unrevised at a 4.30% pace, compared to the second quarter's 3.80% growth rate.

Inflation and Employment Data:

Japan Inflation: Japan's core consumer inflation slowed in December but stayed above the central bank's 2.00% target. The core consumer price index rose 2.40% in December year-over-year, matching market forecasts and slowing from November's 3.00% gain.

Commodity Markets

Precious Metals: Gold prices rose to an all-time high above $4,960.00 in early trading, on track for a weekly gain of more than 7.00%. Gold rate increased 0.50% to $4,959.39 per ounce, while silver price jumped 0.70% to $96.91, also setting a record high.

Currency and Oil: The US dollar was poised for its biggest weekly drop in a year, with the dollar index at 98.329 after dropping 0.58% in the previous session. Crude oil prices fell approximately 2.00% to a one-week low, with Brent futures declining 1.80% to $64.06 per barrel and US WTI crude falling 2.10% to $59.36 per barrel.