Diwali 2025 is poised to be an eventful period for the Indian stock market, with traders and investors eyeing potential opportunities amidst festive cheer. Here's a comprehensive look at the trade setup for Nifty 50, Muhurat trading, gold rates, the India-US trade deal, and some stocks to consider.

Nifty 50 Trade Setup

The benchmark Nifty 50 index has shown renewed optimism, rallying nearly 5% from its recent low in September 2025. Technical analysis suggests a bullish outlook for the short term, with the index breaking out of a Symmetrical Triangle pattern. Key support levels to watch are in the 25400-25350 zone. Experts believe that if there are no negative surprises, the Nifty 50 can very well break out post this consolidation and inch towards the 28,000 levels. Supportive global liquidity, domestic inflows exceeding ₹25,000 crore a month via SIP, and a resilient corporate balance sheet would make this realistic.

Muhurat Trading

The special one-hour Muhurat trading session will be held on October 21, 2025, from 1:45 PM to 2:45 PM. This auspicious trading session coincides with Laxmi Pujan and marks the beginning of the new Samvat year (2082) in the Hindu calendar. It is considered an auspicious time for investing, with the belief that trading during this period brings prosperity and good fortune. The session includes a Block Deal Session from 1:15 PM to 1:30 PM and a Pre-open Session from 1:30 PM to 1:45 PM. All trades executed during the Muhurat session will carry the same settlement obligations as regular trading days.

Gold Rates

Ahead of Diwali 2025, gold prices have seen some correction from record highs. On October 19, 2025, 24-karat gold was priced at ₹1,30,860 per 10 grams. Silver prices also eased to ₹1,70,000 per kilogram. Despite the recent dip, gold remains one of the best-performing assets of 2025, with prices having surged significantly year-on-year. Experts project domestic gold prices to trade between ₹1,20,000 and ₹1,35,000 per 10 grams for the remainder of 2025, potentially rising further by early 2026. For Dhanteras/Diwali 2026, the target for gold is ₹1,40,000–₹1,45,000+.

India-US Trade Deal

Discussions between India and the United States on the proposed bilateral trade agreement are progressing in a "cordial atmosphere". The aim is to finalize the first tranche of the pact by October–November 2025. The proposed agreement intends to more than double India-US trade to $500 billion by 2030 from the current $191 billion. India is keen on safeguarding the interests of its farmers, fishermen, and MSME sector. Recent trade negotiations have seen "solid progress" with both sides having narrowed their differences.

Stocks to Buy

Several brokerage firms have recommended stocks to buy for Diwali 2025, with a focus on potential returns in Samvat 2082. Here are some top picks from various sources:

1. Mahindra & Mahindra (M&M): Recommended by SBI Securities, citing strong technical indicators and bullish momentum for potential short-term gains. A "buy" call has been suggested for a one-year target of ₹4,100.
2. Godrej Properties: Also recommended by SBI Securities, indicating aggressive buying and strong bullish sentiment.
3. Britannia Industries: Prabhudas Lilladher has a target price of ₹6,484, implying a 10.5% upside.
4. ITC: Another pick by Prabhudas Lilladher, with a target price of ₹530 and an upside of 32.8%.
5. Hindustan Aeronautics: Prabhudas Lilladher is also positive on this stock.
6. ICICI Bank: Featured as a "buy" idea by Prabhudas Lilladher.
7. State Bank of India (SBI): Another strong recommendation from Prabhudas Lilladher.
8. Apollo Hospitals: Prabhudas Lilladher has a target price of ₹9,300 per share, implying an 18% upside.
9. Oracle Financial Services Software (OFSS): Recommended for a 12-month horizon target of ₹11,300 and ₹12,200.
10. Reliance Industries and HDFC Bank: Showing favorable technical setups and appear well-positioned for further upside.
11. Maruti Suzuki India: JM Financial has a "buy" rating with a target price of ₹19,000.
12. Fiem Industries: JM Financial recommends this stock with a target price of ₹2,400.

Other stocks to consider: Axis Bank, L&T Finance, Lloyds Metals & Energy, Ratnamani Metals & Tubes, Brainbees Solutions, Anant Raj, Eureka Forbes, and Astral. HDFC Securities has also highlighted high-conviction picks like Infosys, L&T, and Bharti Airtel.

Disclaimer: The stock recommendations are based on various analysts' views and should not be considered as a guarantee of returns. Investors are advised to consult with certified experts before making any investment decisions.