Nobody can predict the situation two months down the line
On the morning of May 4, Indian equity markets stood at a crossroads shaped by forces both distant and domestic — a single statement from Washington easing Persian Gulf tensions had rippled through Asian markets and softened crude oil prices, offering a moment of relief to an economy long burdened by expensive imports. Yet beneath the optimism of rising futures lay a month of foreign capital flight, a weakened rupee, and the unfolding verdicts of five state elections that would quietly signal the political winds ahead. Markets, like democracies, are always weighing the immediate against the enduring.
- GIFT NIFTY futures jumped 154 points overnight as Trump's Persian Gulf statement triggered a 4.4% surge in South Korea's KOSPI and a 1.9% rally in Hong Kong's Hang Seng, pulling Indian sentiment upward.
- Foreign institutional investors had already pulled ₹60,847 crore from Indian markets in April alone, leaving a month-long wound that one morning's optimism could not easily close.
- Five state assembly elections — including the high-stakes contest in West Bengal — were delivering results in real time, with the BJP leading early counts and markets watching for signals about political and policy momentum.
- Around 45 companies were reporting Q4 earnings on the same day, with mixed signals already in — D-Mart's 18.9% revenue jump and Maruti's record sales sitting alongside Nestle's cautious 'wait and watch' guidance.
- Technically, the NIFTY50 had formed a dragonfly doji at a critical support zone of 23,800, suggesting a possible reversal — but resistance at 24,500 and persistent macro headwinds kept conviction fragile.
Indian stock markets were preparing for a stronger start to the week on May 4, with GIFT NIFTY futures climbing 154 points to 24,252 after an overnight shift in global sentiment. The trigger was geopolitical: President Trump announced the United States would help free ships stranded in the Persian Gulf amid the US-Israeli conflict with Iran, sending crude oil down 0.6% to $107 per barrel and sparking rallies across Asia. For an oil-importing economy like India, even a modest decline in crude carries real weight.
The relief arrived after a bruising week. The NIFTY50 had shed 175 points and the SENSEX had fallen 750, weighed down by disappointing earnings, a rupee at historic lows, and relentless foreign selling — foreign institutional investors had offloaded ₹60,847 crore through April, with domestic buyers absorbing only a fraction of that pressure.
Adding another layer of complexity, five state assembly elections were counting votes throughout the day — West Bengal, Assam, Tamil Nadu, Kerala, and Puducherry. Early trends showed the BJP leading in West Bengal and Assam, while the DMK alliance held ground in Tamil Nadu. Markets tend to read these results as proxies for broader political momentum, and traders were watching closely.
The earnings calendar offered its own drama. Avenue Supermarts posted an 18.9% revenue jump, Maruti Suzuki set a domestic sales record with 191,122 units in April, and Royal Enfield saw domestic volumes surge 37%. But Nestle India offered a sobering counterpoint, saying it would 'wait and watch' given geopolitical uncertainty, monsoon risk, and volatile commodity costs — a reminder that even strong companies are navigating with limited visibility.
Technically, the NIFTY50 had closed Friday with a dragonfly doji pattern, a signal that bearish momentum may be exhausting itself. The index had bounced from an intraday low near the critical 23,800 support level, though it remained below its 50-day moving average. Resistance between 24,000 and 24,500 would define the week's ceiling. Whether geopolitical relief and Asian strength could overcome a month of foreign selling — and a day full of election results — was the question the market was quietly asking itself.
The Indian stock market was bracing for a stronger opening on Monday morning, May 4, as futures trading suggested a gap-up start to the week. GIFT NIFTY futures had climbed 154 points to 24,252, signaling that sentiment had shifted overnight. The catalyst was straightforward: crude oil prices had fallen, geopolitical tensions had eased, and Asian markets had responded with conviction. Hong Kong's Hang Seng had surged 1.9% and South Korea's KOSPI had jumped 4.4% after President Donald Trump announced the United States would help free ships stranded in the Persian Gulf amid the US-Israeli conflict with Iran. That single statement had sent crude prices down 0.6% to $107 per barrel—a meaningful relief for an economy that imports most of its oil.
The backdrop, however, remained complicated. The previous week had been punishing. The NIFTY50 had lost 0.73%, or 175 points, closing at 23,997.55, while the BSE SENSEX had fallen 1%, or 750 points, to 76,913.50. The culprits were familiar: corporate earnings had disappointed in places, crude oil had been expensive, and the rupee had hit an all-time low. Foreign institutional investors had been sellers all month, offloading ₹60,847 crore in April alone. On Thursday alone, they had dumped ₹8,047.86 crore worth of shares, though domestic institutional investors had bought ₹3,487 crore, providing some cushion.
Monday's opening would unfold against the backdrop of five state assembly elections underway—West Bengal, Assam, Tamil Nadu, Kerala, and Puducherry. Early trends showed the Bharatiya Janata Party leading on 56 seats in West Bengal against the Trinamool Congress's 38. In Tamil Nadu, the DMK alliance was ahead on 41 seats versus the AIADMK's 22. The BJP was leading in Assam on 41 seats, while in Kerala the UDF held 20 seats against the LDF's eight. Markets would watch these results closely, as they often signal broader political momentum and policy direction.
The earnings calendar was dense. Around 45 companies were scheduled to report fourth-quarter results, including heavyweights like Ambuja Cements, Bharat Heavy Electricals, Godrej Properties, and Petronet LNG. Aster DM Healthcare had already reported consolidated revenue of ₹1,182.38 crore in the quarter, up from ₹1,000.34 crore a year earlier, though net profit had slipped to ₹85.54 crore from ₹85.54 crore. Avenue Supermarts, the operator of D-Mart, had posted an 18.9% jump in quarterly revenue to ₹17,683.86 crore, with profit after tax margins holding steady at 3.7%. Maruti Suzuki had posted record domestic sales of 191,122 units in April, crushing the previous high of 182,165 units set in December. Royal Enfield had seen domestic sales jump 37% to 104,129 units, though exports had fallen 14%.
Nestle India had struck a cautious tone in its guidance, saying it would "wait and watch" given geopolitical tensions, monsoon concerns, and volatile commodity costs. The company's leadership acknowledged that predicting conditions even two months ahead was nearly impossible in the current environment. Lodha Developers, meanwhile, had highlighted its trajectory since listing in April 2021, noting that pre-sales had grown from ₹60 billion in fiscal 2021—the peak of COVID—to ₹205 billion in fiscal 2026, a compound annual growth rate of 28%.
Technically, the NIFTY50 had formed a dragonfly doji pattern on Friday's close, a candlestick formation that often signals a reversal of bearish momentum. The index had bounced from an intraday low of 23,796 to close above its 20-day exponential moving average at 23,978, though it remained below the 50-day EMA at 24,187. The critical support level for the coming week was 23,800, with resistance clustered between 24,000 and 24,500. The 24,500 call options held the highest open interest, marking that level as a near-term ceiling for the index.
As traders settled in for the week, the question was whether the geopolitical relief and Asian strength would be enough to overcome the month-long selling by foreign investors and the uncertainty hanging over corporate earnings. The election results would arrive throughout the day, adding another layer of volatility to an already unsettled market.
Citas Notables
Times are volatile. It's a difficult thing for anyone to predict what's going to happen even two months down the line.— Nestle India leadership on current market conditions
We are starting this year with a big bang. Small cars have contributed significantly to this growth.— Maruti Suzuki India Senior Executive Officer on record April sales
La Conversación del Hearth Otra perspectiva de la historia
Why does crude oil matter so much to Indian markets right now?
Because India imports nearly all its oil. When prices fall, it helps the current account deficit, takes pressure off the rupee, and improves margins for refiners and airlines. A 0.6% drop might sound small, but it signals a shift in risk sentiment.
And the foreign investor selling—₹60,847 crore in one month is substantial. Are they panicking?
Not panicking exactly, but rotating. Higher crude, a weakening rupee, mixed earnings—it adds up. They're being cautious. The domestic investors buying ₹3,487 crore on Thursday suggests some faith remains, but it's not enough to offset the outflows.
The election results—do they actually move markets, or is that noise?
They move sentiment. A clear mandate in any state can signal policy direction, investor confidence in governance. Markets are forward-looking. If results suggest stability, you get buying. If they're fragmented, you get caution.
Maruti's record sales in April—is that a sign the economy is strong?
It's a sign that auto demand is holding up, which is usually a good indicator. But one month doesn't make a trend. You need to see if it sustains. The company itself is cautious about the months ahead.
What's the dragonfly doji telling you?
It's a reversal signal. The index got hammered down to 23,796, but buyers stepped in. That pattern suggests the selling pressure might be exhausted, at least for now. But it's not a guarantee—it's just a hint that momentum could shift.
If the market opens gap-up, what's the real test?
Whether it can hold above 24,000. That's where the open interest is thickest. If it breaks through to 24,500, the rally has legs. If it stalls and rolls over, we're back to the same uncertainty.