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Trade Setup for May 8: Nifty bulls await more cues from border developments, Fed outcomeAccording to Nagaraj Shetti of HDFC Securities, a slide below the initial support of 24,200 levels could trigger short term downward correction in the market. However, a decisive move above 24,600 could bring bulls back into action.By Meghna Sen   May 7, 2025, 8:01:38 PM IST (Published)3 Min ReadThe benchmark Nifty 50 index opened lower by 147 points as investors turned cautious following news of 'Operation Sindoor', a targeted strike by Indian armed forces on terror camps, in response to the deadly April 22 attack in Jammu and Kashmir's Pahalgam.

However, Nifty witnessed smart upside bounce of more than 200 points from its early morning lows as markets digested the news. Despite intraday volatility, the market closed in the green, with the Nifty holding above the 24,400 mark. The index ultimately ended the day up by 35 points, settling at 24,414.

Dalal Street's resilience could also be attributed to a substantial inflow of Foreign Institutional Investors (FII). Over the past 14 days, FIIs have invested ₹43,940 crore, providing crucial support to the market.

Broader markets outperformed the benchmarks, with the Nifty Midcap 100 Index surging 1.6% and the Nifty Smallcap 100 Index rising 1.38%.

Shares of Tata Motors rose 5% on India-UKA Free Trade Agreement (FTA) and the shareholders of the company giving a near consensus approval to demerge the Commercial Vehicle business of the company into two separate, listed entities.

Shares of defence companies such as Hindustan Aeronautics Ltd., Bharat Dynamics Ltd., Bharat Electronics Ltd., along with shipbuilders like Mazagon Dock Shipbuilders Ltd., Cochin Shipyard Ltd. and Garden Reach Shipbuilders saw Profit Booking. Shares of Mazagon Dock Shipbuilders Fell Nearly 5%, while those of its peers, Cochin Shipyard and Garden Reach Shipbuilders were also down between 2% to 3%.

Meanwhile, India and the UK have finalised the FTA after more than three years of negotiations. The FTA is likely to boost bilateral trade and investment between both the countries and benefit several Indian sectors like textiles, auto and auto ancillaries, pharma, agri products, gems & jewellery. This helped improve domestic sentiments and provide support to market on a volatile day, according to Siddhartha Khemka of Motilal Oswal.

Looking ahead, progress on the US-India trade deal is expected to provide near-term support, especially for export-driven sectors. Khemka added that key geopolitical developments, corporate earnings reports, and macroeconomic data from the US are likely to be closely watched, with the potential for short-term consolidation depending on how these factors unfold.

Markets will also focus on important earnings announcements scheduled for Thursday, including from L&T, Britannia, Titan, Pidilite, Biocon, Bharat Forge, Union Bank, and Canara Bank.

Both domestic and foreign investors were net buyers in the cash market on Wednesday.

Nagaraj Shetti of HDFC Securities believes that a slide below the initial support of 24,200 levels could trigger short term downward correction in the market. However, a decisive move above 24,600 could bring bulls back into action.

LKP Securities' Rupak De said the Nifty continues to consolidate within a narrow range, having failed to move past the 61.80% retracement level of the previous decline from the all-time high of 26,277 to the recent low of 21,743. This consolidation may persist in the near term, as the index appears to be in no hurry to make a decisive move beyond the 24,000–24,550 range.

"A decisive breakout above 24,550 could potentially trigger a rally toward higher levels. On the downside, immediate support is placed at 24,200; a break below this level may extend the correction toward 24,000," De added.

On the index front, the Nifty is attempting to hold the 24,100 level; a breach could lead to further downside towards 23,800. Until then, the index is expected to trade within the 24,100–24,600 range, said Ajit Mishra of Religare Broking.

"On the higher side, the 24500-24590 band is likely to act as immediate resistance, while the 24,200 level could provide immediate support on the downside," said Devarsh Vakil of HDFC Securities.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsBSE SensexNifty 50share market todayTrade setup