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Below the Quote on Market Wrap 22 May 2025 by Mr. Ajit Mishra - SVP, Research, Religare Broking Ltd

Markets edged lower after a brief respite, losing nearly a percent, weighed down by weak global cues. Following a gap-down start, the Nifty continued to drift lower for most of the weekly expiry session. However, it rebounded in the final hours after retesting the crucial support zone of the short-term moving average — the 20-day EMA — around the 24,450 level, and eventually closed at 24,609.70. In line with the benchmark’s movement, all key sectoral indices ended in the red, with FMCG, IT, and auto among the top losers. The broader indices also remained under pressure and closed with marginal losses.

The decline was primarily driven by weak global sentiment, particularly from the US markets, in the absence of any significant domestic triggers. Additionally, the recent outflow of foreign funds has further weighed on market sentiment. Going forward, it is crucial for the Nifty to hold above its 20-day EMA support near 24,450. A breach of this level may trigger further profit-taking, potentially dragging the index down to the 24,100 mark. We thus recommend maintaining a cautious stance and adopting a selective approach in the current environment.

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