Stock Market Outlook: Sensex, Nifty Likely to Consolidate Ahead of Fed Decision; Key Resistance at 25,250

As Indian equities head into the trading session on September 16, technical indicators suggest that the market is likely to remain in a consolidation phase with a cautiously optimistic bias. While global cues, especially the US Federal Reserve's upcoming policy decision remain in focus, domestic charts point to critical resistance and support levels that could determine the next market move.

Stock Market Outlook For September 16, 2025

Indian equity markets ended marginally lower on Monday, snapping an eight-day winning streak as investors turned cautious ahead of the US Federal Reserve's much-anticipated policy meeting set to begin on September 16. While the broader market showed resilience, headline indices like the Sensex and Nifty drifted in a narrow range, reflecting uncertainty over global cues.

The benchmark Sensex declined by 118 points, while the Nifty 50 ended the session at 25,069, down by 45 points or 0.18%. Market sentiment remained subdued despite foreign portfolio investors (FPIs) turning net buyers on Friday, adding Rs 130 crore to Indian equities.

Stocks in Focus Today: Sector-wise Stocks Performance Trends

On the sectoral front, Nifty Realty led the gains with a 2.4% jump following value buying after recent corrections. PSU banks and oil & gas stocks also contributed positively. In contrast, defensives such as Pharma, IT, Auto, and Healthcare saw profit-booking after recent rallies.

Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd said, "The broader market outperformed the benchmark indices with Nifty Midcap100 and Smallcap100 rising 0.4% and 0.8% respectively. Amongst sectoral indices, Nifty Realty was the top gainer, up 2.4% on account of value buying after a recent sharp correction in real estate stocks. Meanwhile, Nifty Pharma index declined by 0.6% on profit booking, snapping its four-day gaining streak.'

Global and Domestic Cues in Play: Fed Rate Cut in Focus

Globally, all eyes are on the US Federal Reserve's upcoming interest rate decision. Although a 25 basis points (bps) rate cut is largely priced in by the markets, investors are more focused on the Fed's forward guidance, which could determine the direction of interest rates and bond yields globally. This will have a ripple effect on foreign flows into emerging markets, including India.

India's retail inflation for August came in at 2.07%, in line with estimates, but market participants remain watchful for any signs of economic overheating. Meanwhile, US retail sales data scheduled for release on Tuesday will also influence near-term sentiment.

"On the macro front, India's retail inflation rose to 2.07% in Aug'25 (in line with estimates), after easing for nine consecutive months. Further, market participants would track the US retail sales data to be released on Tuesday. Overall, we expect the market to continue its consolidation, while tracking the US Fed policy outcome and progress in India-US trade talks," Mr Khemka added further.

Sensex, Nifty Prediction Today: Technical Outlook By Experts

The Nifty 50 index formed a bearish candle on the daily chart, which was contained within the previous session's range. This pattern reflects a pause in momentum, with the market awaiting decisive triggers, possibly from global developments.

According to Bajaj Broking Market Commentary, the index is currently facing stiff resistance in the 25,200-25,250 range, a key technical zone marked by the confluence of a previous swing high and the 61.8% Fibonacci retracement level of the recent decline from 25,669 to 24,337. A decisive breakout above 25,250 will be crucial to confirm a trend reversal from the recent correction phase. If such a breakout occurs, it could open the gates for a further rally towards 25,500 in the near term.

"On the downside, immediate support is seen near the 24,800 levels, holding above the same will keep the bias positive. While short term support is placed at 24,600-24,700 levels," the brokerage report stated.

Bank Nifty Technical Outlook For September 16, 2025

The Bank Nifty index also showed signs of hesitation, forming a Doji candle on the daily chart-an indicator of indecision. However, the candle also had a higher high and higher low, suggesting that the current pullback phase has extended into its ninth consecutive session.

"Following a phase of consolidation around the crucial 200 days moving average, the index has absorbed selling pressure and is now positioning itself at the recent breakdown area of 54,800-55,000 levels. Index sustaining above the breakdown area of 55,000 will open further upside towards 55,300 initially and then towards the 56,000-56150 levels in the coming weeks being the 61.8% retracement of the entire decline (57628-53561)," stated Bajaj Broking report.

On the downside immediate support is placed at 54,350 levels being the recent gap area. While key support is placed at 53,500 levels being the confluence of the 200 days EMA and the previous major low of May 2025.

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