Mumbai, June 21 (IANS) Indian equity markets are expected to remain cautiously optimistic in the next week, supported by easing geopolitical tensions in West Asia, softer crude oil prices and improving global risk sentiment, according to analysts on Sunday.

Benchmark indices ended the previous week on a strong note, with Nifty gaining 390 points or 1.65 per cent to close at 24,013.10.

Similarly, Sensex advanced around 1.7 per cent on a weekly basis, while broader markets outperformed with gains of more than 3 per cent.

The rally came amid improving global sentiment following a breakthrough in US-Iran relations.

The development triggered a sharp correction in crude oil prices, easing concerns over global inflation and supply disruptions. Crude prices fell nearly 7 per cent during the week, slipping below the $80-per-barrel mark.

Analysts said lower crude oil prices are particularly beneficial for India, given its heavy dependence on energy imports.

The decline is expected to ease pressure on inflation and the current account deficit, while also supporting the rupee, which strengthened nearly 1 per cent against the US dollar during the week.

For the coming week, analysts expect the 24,150-24,200 zone to act as an immediate resistance area. A sustained move above 24,200 could strengthen bullish sentiment and potentially trigger a fresh rally towards 24,500.

On the downside, the 23,850-23,800 range is expected to provide immediate support as it coincides with the 50-day exponential moving average. A decisive breach below 23,800 could intensify selling pressure and drag the index towards 23,500.

Market participants will also closely monitor further developments in US-Iran relations and movements in crude oil prices, which remain key drivers of sentiment.

In addition, the upcoming trading week will be shortened due to the Muharram holiday on June 26.

Additionally, investors and traders are expected to track key macroeconomic indicators, including India’s May industrial production (IIP) data, US personal consumption expenditure (PCE) inflation data and first-quarter US GDP growth figures.

Analysts advised investors to maintain a stock-specific approach and adhere to strict risk-management practices, while the broader market bias remains sideways to bullish.

–IANS

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