Sensex Opens Strong, Nifty Nears 25,500 Amid Weekly Expiry; IT and Metals Lead Gains

Mumbai, July 3, 2025: Indian benchmark indices commenced trading on a positive note this Thursday, July 3, with the Sensex advancing over 200 points and the Nifty 50 hovering near the 25,500 mark. This uptick comes amidst the weekly derivative expiry, supported by positive global cues and favorable domestic macroeconomic conditions.

Market Overview

As of 09:35 a.m. IST, the BSE Sensex was trading 132.26 points higher at 83,541.95, while the NSE Nifty rose 31.05 points to 25,484.45. The market breadth indicated a slightly positive sentiment, with 1,394 stocks advancing, 1,247 declining, and 140 remaining unchanged.

This morning’s positive opening is a welcome change from yesterday’s session (July 2), which saw both Nifty and Sensex reverse early gains to close lower due to profit booking and cautious sentiment ahead of the crucial U.S. trade tariff deadline on July 9. The Nifty closed at 25,453.40, down 88.40 points, while the Sensex ended at 83,409.69, down 287.60 points.

Sectoral Highlights

Several sectors contributed to the morning’s positive momentum:

• Nifty Auto led the gains with a 0.7% rise, reflecting broad strength across the automobile space.
• Nifty IT and Nifty Metal indices both gained 0.4%, signalling investor interest in these sectors.
• Nifty FMCG edged up marginally, while Nifty Pharma remained largely flat.

Conversely, some sectors experienced slight declines:

• Nifty PSU Bank fell 0.5%.
• Realty and Media dipped by 0.2% each.
• Nifty Energy and Infra also saw mild declines, reflecting cautious sentiment in rate-sensitive sectors.

Institutional Activity

• Foreign Institutional Investors (FIIs) were net sellers worth ₹1,562 crore on July 2.
• Domestic Institutional Investors (DIIs) emerged as strong buyers, pumping in ₹3,037 crore.

Global Cues

Global markets provided a strong backdrop for the positive opening:

• The S&P 500 and Nasdaq Composite both achieved record closing highs, primarily driven by robust performance in the technology sector.
• The Dow Jones ended marginally lower but remained close to its previous record.
• A new U.S.–Vietnam trade deal was announced, which included a 20% tariff on Vietnamese goods entering the US and a 40% tariff on transshipped goods. While this specific deal might not directly impact India, trade experts are urging Indian negotiators to exercise caution as they finalise their own trade agreement with the US before the July 9 deadline, noting potential risks of blanket tariffs and unclear rules of origin. Analysts believe India’s effective tariff rate could stabilize around 15–18% as a result of broader trade policy shifts.

Technical and Derivatives Outlook

According to market analysts, key levels to watch for the Nifty include:

• Resistance: The index faces strong selling pressure near the 25,600–25,700 zone.
• Support: Crucial support levels are pegged at 25,400 and then at 25,300.
• Indicators: The Nifty continues to hold above its short-term 10-day and 20-day Exponential Moving Averages (EMAs), which are acting as dynamic support levels.
• Bullish Trigger: A decisive close above 25,750 could reignite bullish momentum, potentially setting the stage for a move towards the psychological 26,000 mark.

In the options market, the 25,600 strike holds the highest call open interest (1.73 crore contracts), indicating a near-term resistance point. On the downside, the 25,000 put strike has significant open interest (1.06 crore contracts), establishing it as a strong support zone. Derivative sentiment shows signs of consolidation, with call writers active at higher levels and put writers reducing their exposure.

Outlook

Market experts anticipate continued bullish momentum in the near term, bolstered by healthy domestic macroeconomic indicators and favourable global developments. Recent data points to strong economic activity, with India’s manufacturing sector growth reaching a 14-month peak of 58.4 in June, and GST collections for June crossing ₹1.84 lakh crore. Sectors with a domestic focus, such as financials, capital markets, agri-linked segments, and defence, are expected to benefit from ongoing policy support and seasonal tailwinds.

As trading progresses, all eyes remain on the upcoming corporate earnings season, which will kick off next week, and the direction of institutional flows, which could significantly guide the market’s near-term trajectory.

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