If you’re wondering whether Monday could bring a relief rally or another volatile session for the stock market, you’re definitely not alone. Investors walk into the new trading week with mixed signals on board after a tough week that saw the Sensex and Nifty end their two-week winning streak.
On the positive side, strong corporate earnings, positive global cues and the Gift Nifty trading higher are some of the reasons for optimism. However, a record low rupee, rising fuel prices, and Brent crude trading above $107 a barrel are causing increasing discomfort.
Just FYI, Monday’s market setup might be a tug-of-war of positive sentiment and macro pressure.
Here is a list of things to watch out for before Dalal Street opens for trade on May 18:
Markets close week lower on Friday
Domestic equity markets finished lower last week, breaking a run of two consecutive weeks of gains.
The BSE Sensex fell by 2.70% on Friday, closing at 75,237.99. NSE Nifty50 down 2.20%, closes at 23,643.50
Friday’s session had no reprieve, either. The two benchmark indices fell about 0.2% in the last trading session.
Investor caution over inflation, higher oil prices, and a weak rupee drove selling pressure.
Gift Nifty signals positive start today
The early signals are for a slightly positive open on Monday, despite the weakness seen last week.
On the NSE International Exchange, Gift Nifty futures traded about 61 points higher at 23,769, suggesting traders may attempt to make a recovery at the opening bell.
But market experts think the real challenge for bulls starts around the 23,800 level.
Traders may remain cautious unless Nifty decisively crosses and holds above that level.
Investors worried about weak rupee and expensive crude oil
One of the biggest concerns for Dalal Street right now is the sharp fall in the Indian rupee.
The rupee plummeted beyond the ₹96-mark against the US dollar to hit a record low on Friday. For markets, that’s more than a currency headline — it directly impacts foreign investor sentiment, import costs and inflation expectations.
Brent crude was, meanwhile, trading near $107.10 a barrel.
This is significant because India imports a large part of its crude oil requirements. High oil prices often amplify inflation, fuel prices, and the country’s current account deficit.
Petrol prices have already skyrocketed to around ₹106.64 per litre, while diesel prices are hanging around near ₹93.14.
This raises a tough question for the average investor: can markets really sustain a strong rally if fuel prices remain high and the rupee weak?
Why is the 23,800 level on Nifty important?
Bulls and bears are now fighting for the 23,800 zone, market experts say.
Nifty is range-bound with a slight negative bias after failing to hold above 23,700 on Friday, says Ankit Jaiswal, Univest. He said that the market needs to close decisively above 23,800 to confirm any recovery in the medium term.
The opening on Monday could look good in simple terms, but it will be the holding of those gains that matters more than the opening.
What might bolster markets today?
There are also a few positive triggers that support sentiment, despite macro concerns.
Solid Corporate Earnings: Earnings from companies like Tata Steel in the recent past have helped boost confidence around select sectors.
Investors may continue to selectively buy stocks with strong earnings visibility.
Optimism for world trade: Asian market sentiment may also improve due to better global trade talks and positive developments in US-China relations.
PM Modi’s tour to Europe: Investors are also looking at Prime Minister Narendra Modi’s visit to Europe for any trade, investment or diplomatic developments that can provide support to overall market confidence.
Bank Nifty at key resistance zone
Banking stocks might once again be the next market mover. Analysts said that Bank Nifty is currently witnessing a strong resistance zone of 54,400 and 54,600.
Moving north of 54,600 could see the index approach 55,000. But if the index drops below 53,500, analysts see downside risk towards the 52,700-52,400 area.
Private banking names like HDFC Bank, ICICI Bank and Kotak Mahindra Bank are likely to remain in the focus.
Traders’ biggest risks to watch this week
The rupee crosses 96.50 level
The rupee’s further fall from the 96.50 per dollar level is likely to lead to more selling pressure and nervousness in the market among FIIs, analysts said.
Brent Crude Futures Surges Past $110
Brent crude futures are yet another big concern. Brent crude could be above $110 a barrel if there were any increase in geopolitical tensions, especially between the US and Iran.
Such an event could spark a sharp market reaction as higher crude prices directly impact inflation, fuel costs and corporate margins in India.
Also Read: Stocks To Watch Today, May 18: Vodafone Idea, Tata Steel, Coal India, SAIL, Power Grid In Focus
(Disclaimer: This article is for informational purposes only and should not be considered investment advice. The views, opinions, and recommendations expressed herein are those of the respective experts. Readers are advised to consult a qualified financial advisor before making any investment decisions.)
Priyanka Roshan is a business writer and chief sub-editor at the NewsX website who tracks everything from stock market swings and corporate earnings to personal finance trends and policy shifts. Known for turning fast-moving business developments into sharp, reader-friendly stories, she combines speed, accuracy, and a data-driven approach to break down complex financial news for everyday audiences.
With over 9.5 years of newsroom experience, Priyanka has worked with leading media organisations, including Moneycontrol, Times Now, and Ping Digital, covering diverse beats such as business, politics, technology, auto, travel, sports, and the world. From live breaking news desks to SEO-led digital storytelling, she specialises in creating engaging content that keeps readers informed without overwhelming them.
