Indian Stock Market Outlook: Cautious Optimism Amid Global Gains
The Indian stock market is poised for a cautious yet positive opening on Thursday, October 31, 2025, after major Asian markets opened in the green. Both benchmark indices — Nifty 50 and Sensex — are expected to show mild recovery following steep losses in the previous session.
The trends on Gift Nifty indicate a mildly positive start for Indian equities. Gift Nifty was seen trading near the 26,058 level, showing a premium of 26 points over the Nifty futures’ previous close — a sign of optimism among traders after global market stability.
On Thursday, the domestic market suffered heavy selling pressure with both Sensex and Nifty closing lower, dragged by weakness in IT, financials, and energy stocks.
- Sensex fell 592.67 points (0.70%) to close at 84,404.46
- Nifty 50 slipped 176.05 points (0.68%) to close at 25,877.85
However, with global cues improving, investors are eyeing a recovery rally on the last trading day of the week.
Global Market Cues: Asian Stocks Rise on Improved Sentiment
Asian Markets Overview
Asian equities edged higher on Thursday as investors reacted positively to encouraging earnings reports and stabilizing bond yields.
Key indices like the Nikkei 225, Hang Seng, and Kospi all opened higher, giving confidence to emerging market traders, including India.
- Japan’s Nikkei 225 rose 0.85%
- Hong Kong’s Hang Seng gained 1.12%
- South Korea’s Kospi added 0.64%
US Market Influence
The US markets ended higher overnight as investors digested the latest Federal Reserve comments, signaling a possible rate pause in December.
The Dow Jones Industrial Average gained 0.45%, the S&P 500 added 0.38%, and the Nasdaq Composite climbed 0.50%.
Wall Street’s rebound has lifted sentiment across global equities, and Indian markets are likely to mirror this trend in early trade.
Gift Nifty Indicates Positive Start
The Gift Nifty, which reflects early trends for Indian equities, traded near 26,058, up 26 points from the previous close. This indicates a mildly positive start for the benchmark Nifty 50 index, hinting that investors are ready to bargain hunt after Thursday’s correction.
Traders expect initial resistance near 26,100 and support near 25,800, suggesting range-bound movement ahead of month-end expiry and global data releases.
Sensex Technical Outlook
Key Levels to Watch
According to analysts, the Sensex has formed a bearish candle on daily charts, along with a double-top pattern on intraday timeframes — both pointing to potential volatility.
Shrikant Chouhan, Head of Equity Research at Kotak Securities, said:
“We are of the view that Sensex is witnessing range-bound activity; hence, level-based trading would be the ideal strategy for day traders. As long as Sensex remains below 84,500, weak sentiment is likely to continue with potential downside toward 84,200 and even 84,000.”
However, Chouhan adds that a breakout above 84,500 could turn sentiment bullish, paving the way for an upmove toward 84,800–85,000.
Sensex Support and Resistance Zones
- Support levels: 84,200 / 84,000
- Resistance levels: 84,500 / 85,000
- Key trading range: 84,000 – 85,000
Short-covering in select heavyweights and foreign inflows could drive near-term recovery.
Nifty 50 Technical Analysis
Daily Chart View
The Nifty 50 closed below 25,900 on Thursday, forming a bearish engulfing pattern, which indicates selling pressure. However, analysts expect a short-term rebound due to oversold conditions.
Anand James, Chief Market Strategist at Geojit Financial Services, said:
“The index is oversold near 25,800 and we expect a rebound toward 26,050–26,100 zones, provided it sustains above 25,800.”
Nifty 50 Key Levels
- Immediate support: 25,800 / 25,700
- Immediate resistance: 26,000 / 26,150
- Range for today: 25,700 – 26,200
If Nifty breaches 26,150, the index could gain momentum toward 26,250–26,300 levels.
Bank Nifty Outlook: Sector Rotation in Focus
The Bank Nifty index, which heavily influences the Nifty 50, ended lower on Thursday following weakness in HDFC Bank, Axis Bank, and Kotak Mahindra Bank. The index closed near 55,900, down 0.5%.
However, analysts expect a mild recovery today as PSU banks and mid-tier lenders show resilience.
Bank Nifty Key Levels
- Support levels: 55,500 / 55,200
- Resistance levels: 56,200 / 56,500
Analyst Take
According to Rupak De, Senior Technical Analyst at LKP Securities:
“The index has support at 55,500. A move above 56,200 could trigger short-covering. Traders can look for buy-on-dips opportunities as long as 55,500 holds.”
Derivatives Data: Nifty OI Positions
The Open Interest (OI) data from the derivatives segment indicates key market positioning.
- Maximum Call OI: 25,900 & 26,000 strikes
- Maximum Put OI: 25,800 & 25,700 strikes
This data suggests that the market may remain range-bound between 25,700 and 26,000 levels, with traders waiting for clear direction ahead of the next major global event.
FII and DII Activity: Foreign Flows Remain Mixed
Foreign Institutional Investors (FIIs) were net sellers on Thursday, offloading ₹1,245 crore worth of equities, while Domestic Institutional Investors (DIIs) bought ₹1,032 crore.
Market experts believe DII inflows are helping cushion the downside, even as FIIs remain cautious amid global rate uncertainty.
Rupee and Crude Oil Update
- Indian Rupee closed at 83.28 per dollar, marginally weaker due to dollar strength.
- Crude oil prices slipped slightly as OPEC reaffirmed output stability, with Brent crude trading near $85 per barrel.
Falling oil prices could provide relief to Indian importers and support domestic equities.
Sector-Wise Outlook
1. Banking and Financials
After heavy selling in the previous session, the banking sector could witness some bargain buying. PSU banks are expected to outperform, while private lenders may trade cautiously.
2. IT Sector
The IT index has seen correction due to global tech weakness. However, improving US earnings and stable rupee levels could spark selective buying in stocks like Infosys, TCS, and HCL Tech.
3. Metal Stocks
Metal shares may rise as China’s stimulus optimism boosts global commodity demand. Stocks like Tata Steel, Hindalco, and JSW Steel are likely to gain.
4. Energy and Oil
Oil & Gas sector remains mixed; ONGC and Reliance Industries may stay subdued due to crude volatility, while downstream companies could benefit from margin improvement.
5. Pharma and FMCG
These defensive sectors could see inflows amid volatility. Stocks like Dr. Reddy’s, Sun Pharma, and HUL are expected to remain in focus.
Expert Opinions on Market Sentiment
1. Vinod Nair, Head of Research, Geojit Financial Services
“The market correction was long due after the recent rally. However, strong domestic macros, FII inflows, and positive earnings outlook keep medium-term sentiment bullish.”
2. Deepak Jasani, Head of Retail Research, HDFC Securities
“Nifty is likely to consolidate with support at 25,800 and resistance near 26,150. Traders should avoid aggressive positions and use dips to accumulate quality large-caps.”
Trading Strategy for Today
- Buy-on-dips approach above 25,800
- Stop-loss: 25,650
- Target: 26,100 – 26,200
For Bank Nifty, traders can look for a bounce above 56,000 with a target of 56,400–56,600.
Macro Factors to Watch
- Movement of global equities
- FII/DII flow trends
- Crude oil price fluctuation
- US bond yield movements
- Corporate earnings announcements
- Domestic inflation and GDP data releases
Key Takeaways for Traders
✅ Global cues remain positive, led by Asian market recovery
✅ Technical indicators suggest range-bound but bullish bias
✅ FIIs remain cautious, but DIIs support domestic markets
✅ Support zones: Nifty at 25,800 / Sensex at 84,200
✅ Resistance zones: Nifty at 26,100 / Sensex at 85,000
✅ Sector focus: Banking, Metals, IT, Pharma
Conclusion: Market Set for a Balanced Opening
The Indian stock market is expected to open mildly higher on October 31, driven by positive Asian market sentiment and improving global cues. While volatility could persist due to monthly expiry and global data flow, analysts remain optimistic about a near-term rebound.
With Nifty 50 trading near 25,900 levels and Sensex hovering around 84,400, traders should adopt a disciplined, level-based trading approach, keeping an eye on key technical levels and global developments.
