Indian markets eye cautious open as US-Iran tensions weigh; eight stocks to watch

Monday's trading session in Indian markets was a study in contradiction—volatile throughout the day, yet ultimately closing in the black. The Nifty 50 climbed 255 points to settle at 22,968, while the BSE Sensex surged 787 points to 74,106. The Bank Nifty advanced even more sharply, gaining 1,060 points to close at 52,609. Realty, financials, and banking stocks led the recovery, with midcap and smallcap indices each rising roughly 1.5%, suggesting that risk appetite, though selective, had returned by day's end.

But the morning ahead looked different. Gift Nifty was trading down about 100 points in early Asian hours, signaling a more cautious start. The tension stemmed from geopolitical uncertainty that had gripped global markets: the US-Iran conflict, which had already rattled crude oil prices and commodity markets, was entering a critical phase. President Trump had set a Tuesday deadline—8 p.m. Eastern Time—for Iran to reopen the Strait of Hormuz, and his rhetoric had escalated sharply. Over the Easter weekend, he had posted a warning on Truth Social threatening Iran with "Hell" if the waterway remained closed. By Monday, speaking at the White House, he declared the country could be "taken out in one night," adding that Tuesday would be "Power Plant Day, and Bridge Day, all wrapped up in one." The specificity of the threat, and the precision of the deadline, had unsettled markets globally.

Crude oil had responded immediately. WTI crude was trading near its record high of $115 per barrel in early Asian trading, a level that rippled through commodity markets. Gold, which typically benefits from geopolitical uncertainty, instead faced headwinds. COMEX gold opened flat, touched an intraday high of $4,694.90 per troy ounce, then retreated as profit-taking kicked in. By mid-morning, it was trading around $4,650 per ounce, down 0.75% from the previous close. Silver fell harder, dropping 1% to around $72 per ounce. Market experts noted that gold was trading in a broader range of $4,450 to $4,800 per ounce, while silver oscillated between $62 and $78 per ounce.

The Indian rupee, meanwhile, had gained some ground. It strengthened by 28 paise to close at 92.90 against the US dollar on Monday, a move supported by Reserve Bank measures aimed at curbing speculation and stabilizing the currency. Yet analysts cautioned that this recovery was fragile. Foreign institutional investors continued to withdraw capital, the dollar remained firm globally, and crude oil prices—now elevated by geopolitical risk—continued to exert downward pressure on the rupee. One currency strategist noted that while the RBI's interventions had provided a technical bounce and initial hopes of US-Iran de-escalation had helped sentiment, the underlying pressures persisted. Support for the rupee was seen around 92.45, with resistance building near 93.75 to 94.00.

Domestically, the picture was complicated by the fact that Monday was options expiry day. The India VIX remained elevated above 25, indicating sustained volatility in the system. At such levels, option premiums were expensive, and the typical acceleration of time decay—which usually dominates expiry dynamics—was significantly slower. This meant that directional volatility, rather than the passage of time, would likely drive price movements. Market analysts expected the Nifty 50 to open on a flat note, with the weekly expiry adding another layer of uncertainty. If the index broke above 23,000, it could extend gains toward 23,400 to 23,500, where the 20-day exponential moving average posed a hurdle. On the downside, support lay in the 22,500 to 22,000 range.

The Bank Nifty showed more constructive technical signals. On the daily chart, a positive divergence had appeared in the Relative Strength Index, supported by a bullish crossover, suggesting improving momentum. The index had closed above its 10-day simple moving average for the first time in 21 sessions, forming a strong bullish candlestick that signaled a potential short-term reversal. Analysts expected a mean-reversion move toward the 20-day average, which sat in the 54,000 to 54,200 zone. Immediate resistance was placed at 53,500, with support at 51,800.

For traders looking for specific opportunities, market experts had identified eight stocks worth watching for intraday moves: Granules India, CCL Products, DLF, L&T Finance, Shriram Finance, Finolex Cables, Netweb Technologies, and SBI. Recommendations ranged from buying Granules India at ₹644 with a target of ₹690 to purchasing Netweb Technologies at ₹3,225 with a target of ₹3,370. Each recommendation came with a stop-loss level to manage downside risk. Yet beneath these specific calls lay a broader caution: with foreign investors still pulling money out, crude oil near record highs, and a geopolitical deadline just hours away, the market's recovery felt provisional. Analysts advised traders to maintain a cautious stance, favoring relatively strong stocks for long positions while considering laggards for short opportunities. The real test would come when markets opened on Tuesday morning, after Trump's deadline had passed.