Dalal Street is expected to see acautious starton Friday after witnessing sharp selling pressure over the past four trading sessions. Both theSensexand theNifty 50have declined steadily, with Nifty falling1.7%and Sensex slipping1.8%during this period.

Early signals from theGift Niftypoint to a mildly positive opening. Gift Nifty futures were trading around25,998, indicating a start above Thursday’s Nifty close of25,876.85. Despite this, investor sentiment remains guarded.

The recent market decline has been triggered byfresh concerns over US tariffs on Indian goods, after US PresidentDonald Trumphinted at the possibility of raising tariffs further, citing India’s continued purchases of Russian crude oil. The US has already imposed tariffs of up to50%on certain Indian imports, adding pressure at a time when India is negotiating a long-pending trade agreement with Washington.

Another key global trigger is theanticipated ruling by the US Supreme Courton the legality of these tariffs. If the court rules against the tariffs, the US government may be required to refund nearly$150 billionto importers, which could have wide-ranging implications for global trade and financial markets, including India.

Foreign portfolio investor (FPI) activity continues to weigh on sentiment. FPIs have sold nearly$900 million worth of Indian equities in January so far, following massive outflows of around$19 billion in 2025.

Technical View

From a technical perspective, analysts remain cautious. According to Rupak De of LKP Securities, Nifty hasbroken below its rising trendlineand slipped under the26,000 psychological level. More importantly, the index has closedbelow its 50-day EMA for the first time in three months, indicating a bearish shift. RisingIndia VIXlevels also signal increased market volatility. Immediate downside levels for Nifty are seen at25,700 and 25,550, while a recovery would require a decisive move above26,000.

On the Sensex, analysts note repeated rejection near the85,000mark. Support is seen in the83,600–83,700range, while resistance lies around84,600–84,700. As long as the index remains below resistance, volatility is expected to persist.

Market Outlook

While early indicators suggest a slight bounce at the open, experts warn thatsustained upside will depend on clarity around global trade issues, US court developments, and improvement in domestic earnings. Until then, markets are likely to remain volatile.