Market Wrap

Indian equity markets witnessed another volatile session on 4 June, with benchmark indices opening nearly 100 points lower and remaining under pressure through the first half of the day. Selling activity pushed the Nifty towards the 23,150 mark, but strong buying interest emerged at lower levels, particularly in banking stocks, helping the index recover sharply and close almost unchanged near 23,405.

The recovery was significant from a technical standpoint as the Nifty managed to fill the gap created during the 7–8 April selloff, indicating that buyers continue to defend key support zones despite the prevailing weakness. However, the broader trend remains cautious, with FIIs continuing to offload equities and the index registering lower lows for six consecutive sessions, suggesting that near-term market control still rests with the bears.

Sectorally, the sharpest action was seen in the IT pack. After leading gains in the previous session, technology stocks witnessed aggressive profit booking, dragging the Nifty IT Index down 5.57%. Several frontline IT names declined between 5% and 10%, making the sector the biggest drag on the market. Global cues remained largely muted, keeping domestic developments at the center of investor attention.

What's Ahead

The focus now shifts to key macroeconomic events that could influence market direction in the coming sessions. The RBI Monetary Policy Committee's decision, scheduled for 5 June, remains the biggest near-term trigger, with markets assessing the central bank's stance on growth and liquidity. India's latest GDP data will also be closely tracked for fresh insights into the strength of domestic economic activity.

Alongside domestic factors, developments surrounding India–US trade negotiations could shape sentiment in export-oriented sectors. Expectations of a supportive monetary policy environment and forecasts of a normal monsoon season may provide support to consumption and rural-linked stocks. From a technical perspective, the 23,150–23,200 zone remains a key support area for the Nifty, while resistance is placed at 23,555, 23,620, and 23,730. A decisive move beyond these levels could determine the market's next directional trend.

Market Snapshots

Institutional Activity

Sectoral Performance

Technical Outlook

Nifty 50

The Nifty 50 resumed its corrective trend after a brief one-day recovery, closing below the 23,500 mark as sharp selling in IT heavyweights offset gains in banking and healthcare stocks. Despite the weakness, the index witnessed strong value buying near the 23,150 zone, helping it recover significantly from intraday lows. Technically, momentum remains weak with the RSI slipping towards the 40 level, indicating that sellers continue to maintain an edge. The immediate support zone is placed at 23,184–23,047, and a breach below these levels could trigger further downside pressure. On the upside, resistance is seen at 23,627 followed by 23,764, with a sustained move above these levels required to revive bullish momentum.

Bank Nifty

The Nifty Bank outperformed the broader market, ending near the day's high after a strong second-half recovery led by both PSU and private banking stocks. The index successfully absorbed early selling pressure and formed a bullish intraday reversal, highlighting continued buying interest in the banking space. The RSI is rising sharply towards the 50 mark, signaling improving momentum and strengthening participation from buyers. As long as the index holds above the support zone of 53,536–53,134, the near-term bias remains positive. On the upside, resistance is placed at 54,836 and 55,238, and a breakout above these levels could pave the way for an extension of the ongoing recovery.

Nifty Financial Services

The Nifty Financial Services index extended its gains, supported by strength in major banking stocks and select NBFC counters. Although market breadth remained evenly balanced, the index managed to hold above key short-term support levels, reflecting underlying resilience in the financial space. The continued outperformance of banking names remains a positive signal for the broader financial sector. Technically, the index is trading within a defined range, with support placed at 24,556–24,315 and resistance at 25,334–25,575. A decisive move above the upper resistance zone could strengthen bullish sentiment, while a break below support may invite profit booking in the near term.

Sensex

The Sensex ended lower for the session as heavy selling in frontline IT stocks and select large-cap names outweighed gains in banking and industrial counters. However, similar to the Nifty, the index recovered sharply from intraday lows, suggesting the presence of buyers at lower levels despite prevailing market uncertainty. The broader trend remains cautious amid continued FII outflows and sector-specific weakness in technology stocks. Technically, the index is approaching a crucial support zone at 73,606–73,149, while resistance is placed at 75,086 and 75,544. Holding above support will be critical for maintaining stability, whereas a sustained move above resistance could signal a return of positive momentum.