The markets staged an impressive rebound on Thursday, recovering from sharp intraday losses amid renewed hopes of trade negotiations between India and the U.S.
Gaurav Garg,
Lemonn Markets Desk
Mumbai, August 7, 2025: "Indian equity markets staged an impressive rebound on Thursday, recovering from sharp intraday losses amid renewed hopes of trade negotiations between India and the U.S. On the weekly expiry day, the Sensex, which had fallen nearly 720 points earlier in the session, clawed back over 700 points to close at 80,645.04. The Nifty also reversed a 220-point drop to reclaim the 24,500 mark. The early decline was triggered by U.S. President Donald Trump's announcement of a 50% tariff on Indian goods, citing India's continued oil imports from Russia. However, markets took comfort in the 20-day negotiation window ahead of a U.S. trade delegation’s visit to India on August 24.
The recovery was further supported by a confluence of positive cues: upbeat global markets, appreciation in the rupee, easing volatility, and value buying across sectors. Asian markets were broadly higher, mirroring overnight gains on Wall Street. The rupee strengthened by 5 paise against the dollar, aided by steady foreign inflows. Meanwhile, the India VIX dropped 1.5%, signaling lower market anxiety. Value hunting in beaten-down auto, IT, and pharma stocks drove the bounce, helping markets finish the day on a firm footing despite geopolitical jitters."
Shrikant Chouhan, Head Equity Research, Kotak Securities, adds: Today, the benchmark indices experienced a volatile trading session. The Nifty closed 22 points higher, while the Sensex was up by 79 points. Among sectors, IT, Media, and Digital indices rallied over 1 percent, whereas intraday profit booking was observed in Reality and Energy indices. Technically, after a gap-down open, the market corrected sharply. However, it eventually found support near 24,350/79800 and bounced back sharply. From the day's lowest point, the market rallied over 275 /900 points. Additionally, on intraday charts, a reversal formation has appeared, which is largely positive.
We are of the view that 24,500/80300 will act as a key support zone for day traders. As long as the market stays above this level, the pullback formation is likely to continue. On the higher side, the market could move up to 24,800/81000. Further upside may also continue, potentially lifting the index up to 24,875/81350. On the flip side, a decline below 24,500/80300 could change the sentiment. Below this level, the market could retest the levels of 24,350-24,300/79800-79650.
Given the current market volatility, level-based trading would be the ideal strategy for day traders.
