- May 23, 2026
Nifty Prediction For Monday: Will RBI’s Record Rs 2.87 Lakh Crore Dividend Boost Markets On May 25?
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Analysts says the 23,300 zone has emerged as a strong support level and as long as the Nifty holds above this mark, the possibility of a base formation remains intact.
Nifty Prediction For Monday, May 25.
Nifty Prediction For Monday, May 25: The domestic equity market is likely to see a cautious but positive start on Monday, May 25, amid record RBI’s surplus transfer, improving global sentiment, easing crude oil prices and continued support from domestic institutional investors (DIIs). The GIFT Nifty, which indicates how the Nifty is likely to open, closed at 23,720 on Saturday at 2:30 am, up 29 points.
A fresh round of high-stakes diplomatic engagement involving Iran, Pakistan and Qatar is underway in Tehran, with negotiators attempting to narrow differences over sanctions relief, frozen Iranian funds and broader conflict de-escalation in the region amid indirect engagement with the United States. Discussions held late Friday night were described as “positive”, although negotiators have not yet reached a final agreement.
Market experts believe that despite heightened volatility due to the ongoing US-Iran conflict and weakness in the rupee, the Nifty has started showing signs of base formation near lower levels. However, analysts say upside momentum may remain capped unless the index decisively crosses key resistance zones.
The price of Brent crude oil stood at $103.54 per barrel on Friday.
Ravi Singh, chief research officer at Master Capital Services, said the Nifty 50 managed to close the week with a gain of 0.32% after weakness in the previous week. He noted that the index continues to trade below both the 21-day and 55-day EMA on daily and weekly charts, indicating that the broader trend remains weak.
He said the 23,300 zone has emerged as a strong support level and as long as the Nifty holds above this mark, the possibility of a base formation remains intact. Singh added that consolidation over the past two weeks is helping the market stabilise at lower levels. On the upside, he sees 23,850 as an important resistance level, while a sustained move above it could push the index towards 24,200 in the near term.
Ponmudi R, CEO of Enrich Money, said markets remained highly volatile and range-bound during the week due to persistent rupee weakness, mixed global cues and uncertainty around inflation and interest rates. However, sentiment improved in the latter half of the week after reports of indirect talks between the US and Iran and a correction in crude oil prices.
He noted that crude oil prices cooled from recent highs, offering some relief to India’s macroeconomic outlook by easing concerns around imported inflation and currency pressure. However, investors continue to remain cautious due to uncertainty surrounding geopolitical developments and elevated US bond yields.
On the technical front, Ponmudi said the Nifty continues to trade with a corrective bias and immediate support is placed around the 23,150-23,250 zone. On the upside, the 23,800-24,000 range remains a major hurdle. A decisive breakout above this zone could trigger fresh upside momentum towards 24,500-24,650.
Experts also highlighted that continued foreign institutional investor (FII) selling remains a concern for the market. Total FPI outflows in 2026 have crossed Rs 2.19 lakh crore so far. However, strong domestic institutional buying helped cushion the downside during the week. On Friday alone, DIIs bought shares worth Rs 6,003 crore against FII selling of Rs 4,440 crore.
Sectorally, banking, FMCG and IT stocks supported the market during the week, while IT stocks benefited from rupee depreciation. Analysts believe volatility may continue in the coming sessions due to geopolitical headlines, crude oil movement and rupee fluctuations.
For Monday’s trade, analysts expect the Nifty to remain range-bound with a positive bias. Immediate support is seen near 23,300, while resistance is placed in the 23,800–24,000 zone. A breakout above resistance could strengthen bullish momentum, while failure to hold support may again trigger selling pressure.
Key Events to Watch
Religare Broking’s Ajit Mishra said the upcoming week is expected to remain highly sensitive to global macroeconomic developments, currency movements, and policy commentary. To begin with, participants will closely assess the impact of the RBI’s record dividend transfer on liquidity expectations, fiscal flexibility, and government spending prospects going forward.
Investors will also monitor crude oil prices, developments in US-Iran negotiations, and the trajectory of the US dollar and bond yields, all of which are expected to influence foreign flows and overall risk appetite.
Domestically, Industrial Production (IIP) data for April 2026, scheduled for release on 28 May, will be closely tracked for insights into manufacturing activity and broader economic momentum after recent signs of moderation.
Market participants will also monitor government budget data and the fiscal deficit position for FY26, scheduled for release on 29 May, which will provide clarity on the government’s fiscal trajectory.
Foreign exchange reserves data will remain another key monitorable amid continued pressure on the rupee and expectations of RBI intervention.
The Reserve Bank of India (RBI) on Friday approved a record dividend payout of Rs 2.87 lakh crore to the central government for the 2025-26 financial year, giving a major boost to public finances at a time of global economic uncertainty and rising geopolitical tensions.
The surplus transfer is higher than the Rs 2.69 lakh crore paid in FY25 and Rs 2.1 lakh crore transferred in FY24. The payout is expected to provide the government with extra fiscal room for spending while helping keep the fiscal deficit under control.
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