Indian stock markets are poised for a positive opening on October 16, buoyed by positive global cues and ongoing India-US trade discussions. Both the Nifty 50 and Sensex are expected to extend gains, with analysts eyeing the 25,500 mark for the Nifty.
Global and Domestic Cues
Global market sentiment is supportive, with European markets closing mostly higher. The U.S. markets also ended mostly in the green, fueled by strong earnings reports from major banks. Gift Nifty is trading around 25,461, indicating a premium of nearly 37 points from the Nifty futures' previous close, suggesting a firm start for domestic markets.
On Wednesday, the Indian stock market closed higher, with the Nifty 50 closing above the 25,300 level. The Sensex surged 575.45 points, or 0.70%, to close at 82,605.43, while the Nifty 50 settled 178.05 points, or 0.71%, higher at 25,323.55.
India-US Trade Talks
India and the United States are actively engaged in trade talks, aiming for a mutually beneficial agreement. An Indian negotiating team is currently in the U.S. to expedite discussions. The goal is to more than double bilateral trade to $500 billion by 2030, from the current $191 billion. The U.S. remained India's largest trading partner for the fourth consecutive year in 2024–25, with total bilateral trade at $131.84 billion.
The proposed agreement aims to ease tariffs and align supply-chain interests. The U.S. is likely to offer 16–18% tariff access, higher than the 15% extended to the EU and Japan. A swift agreement could help unwind recently imposed U.S. tariffs of up to 50%, which have impacted Indian exporters.
Analyst Outlook
Analysts believe the Nifty has formed a bullish candle, signaling a continuation of positive momentum. The index is expected to trade with a positive bias, potentially moving towards 25,500-25,600. Immediate support is placed at 25,200.
Shrikant Chouhan, Head of Equity Research at Kotak Securities, noted that 25,200 would act as a key support zone for day traders and as long as the market trades above this level, the positive sentiment is likely to continue. Rupak De, Senior Technical Analyst at LKP Securities, added that Nifty has managed to close above the resistance zone of 25,250–25,300.
FII/DII Activity and Other Factors
Persistent selling by Foreign Institutional Investors (FIIs) may limit sharp gains, but strong inflows from Domestic Institutional Investors (DIIs) are likely to cushion declines.
The International Monetary Fund (IMF) has upgraded India's economic growth forecast for FY26 to 6.6%, citing strong domestic demand and resilience amid global trade headwinds. The Indian rupee recorded its strongest intraday surge, attributed to strong central bank support and hopes of an improved US trade outlook.
Sectoral Focus
Sector-wise, Realty, Power, and PSU Bank stocks are expected to be in focus. The Nifty Realty index jumped 3% in the previous session, followed by gains in Power, Consumer Durables, PSU Bank, Metal, and Telecom.
Overall, the Indian stock market is expected to trade with cautious optimism on October 16. Positive global cues, progress in India-US trade talks, and strong domestic macroeconomic factors are likely to support market momentum. However, investors should remain vigilant of FII selling and potential volatility.
