Sensex, Nifty brace for weak open as tariff jitters dent sentiment; key levels to track on July 16

In the previous session, equity markets snapped a 4-day losing streak as cooling retail inflation spurred bets that the Reserve Bank of India might trim the key benchmark lending rate further.

Benchmark indices Nifty and Sensex are set for a rough start on July 16, as sentiment soured after US President Donald Trump threatened fresh tariffs on pharmaceuticals and semiconductors. The delay in the India-US trade deal has added to the pressure in the recent sessions, dragging down investor confidence. At about 7:30 am, the Gift Nifty was trading at 25,186, lower by 0.3 percent or 80 points.

In the previous session, equity markets snapped a 4-day losing streak as cooling retail inflation spurred bets that the Reserve Bank of India might trim the key benchmark lending rate further. The broader markets outperformed the frontline indices.

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Foreign portfolio investors (FPIs) and domestic institutional investors (DIIs) were net buyers on July 15. FIIs net bought Rs 120 crore in Indian equities while domestic investors net bought Rs 1,555 crore.

Here are the important levels to watch out for in today's session

A reasonable positive candle was formed on the daily chart with a minor upper shadow. Technically, this market action indicates an attempt to bounce back from near the lower support levels of around 25,000. Further sustainable upside from here could confirm the short-term bottom reversal pattern for the market. The bounce back of Tuesday could be a cheering factor for the bulls to make a comeback. A sustainable move above the immediate resistance of 25350 could open more upside in the near term. Immediate support is placed at the 25,000 levels.

The Bank Nifty index found support near an upward-sloping trendline and staged a notable pullback, reflecting renewed buying interest at lower levels. Importantly, the index also moved above its 20-day EMA, signalling improving momentum within the banking space.

"The 56,800–56,700 zone will act as immediate support for the index. On the upside, the 57,200–57,300 zone will act as a crucial hurdle for the index. Any sustainable move above the 57,300 level will lead to a sharp upside rally up to the 57,700 level, followed by 58,200 in the short term," said Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities.

India VIX — the market’s fear gauge — dropped sharply by 4.17 percent to 11.48 on July 15, marking its lowest close since April 26, 2024. This comes after a two-day rise in volatility. Experts note that VIX has remained well below the psychological 15 mark, suggesting limited risk of abrupt sell-offs in the near term.

The Nifty Put-Call ratio (PCR), which indicates the mood of the market, climbed to 0.88 on July 15, compared to 0.72 in the previous session. The increasing PCR, or being higher than 0.7 or surpassing 1, indicates that traders are selling more Put options than Call options, which generally suggests a firming up of bullish sentiment in the market.