Indian equity markets are expected to open on a positive note on January 28, 2026. Optimism surrounding the recently finalized India-EU Free Trade Agreement is likely to influence market sentiment. Analysts expect intraday volatility to stay elevated for the January monthly F&O expiry, ongoing Q3 earnings season and positioning before the announcement of the Union Budget.
Early cues from GIFT Nifty also indicate a positive start with the index trading around 25,442, a premium of 60 points over the previous close of Nifty futures.
On Tuesday Indian equities staged a sharp recovery from intraday lows. The Nifty 50 rebounded from 24,932 to close at 25,175.40, gaining 126.75 points or 0.51%. Sensex added 319.78 points or 0.39% to settle at 81,857.48.
The Sensex witnessed steady buying interest, driven primarily by heavyweight stocks in the banking, metal, and oil & gas sectors.
Analysts note that Sensex’s ability to hold above the 81,700-81,800 zone signals strengthening market internals.
Immediate resistance is expected near 82,350-82,700, a zone that could determine whether the uptrend sustains.
Support for Sensex is around 81,500, with a stronger demand zone near 81,000. A close above 82,700 on sustained volumes would indicate a shift in momentum.
Technically, the Nifty 50 has reclaimed its 200-day moving average, a key long-term trend indicator. The index also formed a strong bullish candle with a long lower shadow, suggesting buying interest near lower levels.
Immediate resistance is seen at 25,400-25,500, a decisive breakout above which could shift the broader structure back to bullish.
On the downside 25,150 is still the first support followed by a stronger base near 25,000.
Derivatives data indicate cooling volatility, with India VIX easing from recent highs, though it remains elevated compared to earlier in the month.
Bank Nifty rose 732.35 points or 1.25% to close at 59,205.45. The index continues to hold above its rising channel support near 58,150, reflecting strong institutional participation.
A sustained move above 59,500 could open the path towards 59,700-60,000, while 58,600-58,700 is expected to act as a strong support zone.
Sectoral performance remained mixed. Metals, banking, and oil & gas stocks attracted fresh buying, while FMCG, auto, and media stocks saw mild profit booking.
Larger markets stays supportive with Nifty Midcap and Smallcap indices gaining 0.59% and 0.41%.
Motilal Oswal Financial Services predicts the India-EU FTA could enhance export competitiveness for sectors such as pharmaceuticals, textiles, chemicals, and auto ancillaries.
RBI liquidity measures, including nearly $23 billion injected via bond purchases and forex swaps, have also helped stabilise market sentiment.
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