Ahead of Market: 10 things that will decide stock market action on Monday

New Delhi, India Jul 5, 2026 ALN: The Indian stock market has recently exhibited a remarkable performance, particularly with its benchmark indices—the Sensex and Nifty—extending their gains in a notable upward trend. On Friday, both indices rose more than 0.3%, reflecting a positive sentiment among investors. The Sensex gained approximately 262 points to close at 77,764, while the Nifty 50 rose by more than 95 points, ending the session above 24,270. This upward movement in the market resulted in an increase of nearly Rs 44,155 crore in the total market capitalisation of all companies listed on the Bombay Stock Exchange (BSE), bringing it to an impressive Rs 480 lakh crore. This performance is particularly noteworthy given the backdrop of fluctuating global and uncertainties that have characterized recent months.

This bullish trend can be attributed to a combination of factors. One significant influence has been the easing of geopolitical tensions in the Middle East, which have historically caused fluctuations in global . Such tensions often lead to volatility in oil prices and investor sentiment, making their resolution a critical factor for market stability. Additionally, there has been a notable decline in expectations regarding future rate hikes by the US Federal Reserve. This shift has contributed to a more favorable investment environment, as lower interest rates typically encourage borrowing and investment. The positive sentiment in the market has also been buoyed by supportive global cues, as well as the ongoing recovery in the IT sector—a significant contributor to India's economy. The IT sector's recovery is particularly relevant as it reflects broader trends in technology adoption and digital transformation, which have been accelerated by the pandemic.

Market Pulse Analysis

According to Vinod Nair, the Head of Research at Geojit Investments, the domestic market's performance has remained strong despite experiencing intermittent volatility and profit-booking. Such volatility is not uncommon in stock , especially when investors react to news or indicators. Nair highlighted the importance of the recent outcomes from the India–Japan Summit, which have been perceived positively by investors. Diplomatic engagements such as this summit can have significant implications for trade, investment, and bilateral relations, all of which can influence market dynamics. Furthermore, the softening of crude oil prices has emerged as a crucial macro factor. Lower oil prices can help support the inflation outlook and enhance the overall stability of the economy, as they reduce costs for consumers and businesses alike.

As the market looks ahead, attention is now shifting towards the upcoming Q1FY27 earnings season. Investors are keenly awaiting management commentary from various companies, particularly in light of the widening monsoon deficit, which could impact agricultural output and, consequently, the economy. The monsoon season is critical for India, as it significantly affects agricultural productivity, which in turn influences rural income and consumption patterns. Nair suggests that investors are likely to adopt a 'buy-on-dips' strategy, focusing on earnings quality and global developments, including progress on the proposed US–India Free Trade Agreement (FTA). The FTA has the potential to enhance trade relations and cooperation between the two nations, which could further stimulate market activity.

Technical View

From a technical perspective, the Nifty index has registered a consolidation breakout on the daily chart, indicating an improvement in market sentiment. Technical analysis is a method used by traders to evaluate securities and forecast future price movements by analyzing statistical trends from trading activity. Rupak De, a Senior Technical Analyst at LKP Securities, remarked that the index is sustaining above the crucial 50-day Exponential Moving Average (EMA), which reinforces a positive short-term trend. The EMA is a type of moving average that gives more weight to recent prices, making it a useful indicator for tracking price trends. Furthermore, the Relative Strength Index (RSI) has witnessed a bullish crossover, adding to the momentum. Analysts predict that the Nifty is well-positioned to advance towards 24,500 and potentially higher, with immediate support levels identified at 24,200 and a stronger support zone around 24,000. Such technical indicators are essential for traders as they provide insights into potential entry and exit points.

Most Active Stocks

In terms of trading activity, several stocks have emerged as the most active on the National Stock Exchange (NSE). The highest turnover was recorded by Policy Bazaar, followed by Zensar Tech, CG Power, ABB Power, HDFC Bank, ICICI Bank, and GE T&D India. These stocks have attracted significant investor interest, reflecting their importance within the market. High turnover often indicates active trading and can suggest that investors are responding to news or events affecting these companies. Moreover, when considering trading volume, Vodafone Idea led with 31.05 crore shares traded, followed by Ola Electric Mobility, Yes Bank, Suzlon Energy, Zensar Tech, Reliance Power, and Bank of Baroda. The volume of shares traded can often provide insights into investor sentiment and market trends, indicating stocks that may be experiencing heightened interest. Increased volume can also signify a potential shift in market direction, as it often accompanies significant price movements.

Stocks Showing Buying Interest

Several stocks have recently witnessed strong buying interest, including Sumitomo Chemical, Zensar Tech, Aegis Vopak Terminals, eClerx Services, HCL Tech, Kaynes Technology, and M&M Financial. These companies are likely seen as having strong fundamentals or positive growth prospects, attracting investors looking to capitalize on potential gains. Strong buying interest can also indicate confidence in a company's future performance, which may be based on recent earnings reports, product launches, or strategic initiatives. Investors often look for stocks with solid fundamentals, as these are generally perceived as more stable and reliable investments.

52-Week Highs

In a sign of positive market momentum, several stocks reached their 52-week highs on the NSE. These include Aurobindo Pharma, Nuvama Wealth Management, Oberoi Realty, Aadhar Housing Finance, Cadila Healthcare, Anand Rathi Wealth, and Ipca Laboratories. Stocks reaching new highs often indicate investor confidence and can attract further interest from market participants. Achieving a 52-week high can also signal a strong performance relative to peers and can be a catalyst for additional buying as investors seek to capitalize on momentum.

Stocks Under Selling Pressure

Conversely, some stocks have experienced significant selling pressure. Notable mentions include GE T&D India, ABB Power, Siemens Energy India, CG Power, Union Bank of India, Thermax, and Apar Industries. Such selling pressure may be attributed to various factors, including profit-taking by investors, concerns over company performance, or broader market trends that could be influencing investor sentiment. Profit-taking is a common strategy where investors sell shares to realize gains after a stock has appreciated in value, which can lead to temporary declines in stock prices.

Market Sentiment

The overall market sentiment on the NSE was mixed on Friday, with 1,823 stocks advancing, 1,513 declining, and 100 remaining unchanged out of the 3,436 stocks traded. This breadth of market activity underscores the diverse reactions among investors and highlights the importance of monitoring market trends and individual stock performances. Market sentiment can be influenced by a variety of factors including data releases, corporate earnings reports, and geopolitical events. As the market continues to evolve, various factors will play a crucial role in determining future trends. Investors will need to remain vigilant, keeping an eye on both domestic and global developments that could impact market dynamics. The upcoming earnings season, geopolitical developments, and shifts in monetary policy will all be significant indicators to watch as investors navigate the complexities of the stock market.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of the publication.)