• Key market triggers: Upcoming market momentum is expected to be driven by sustained domestic inflows (with roughly ₹23,000 crore entering equity mutual funds during the month), progress on the US-India trade deal, and upcoming quarterly results in July.
• Large-cap derivative signals: Futures for the top 10 Nifty stocks have returned to trading at a premium after an unusual period of discounts and heavy shorting, mitigating the recent 3% underperformance of Sensex relative to Nifty.
• Equity asset allocation: Investors are advised to maintain a portfolio split of 50–55% in large-caps, 20–25% in mid-caps, and 20–25% in small-caps, supported by strong domestic liquidity heading into mid- and small-cap segments.
• Sectoral opportunities: A positive outlook remains on defense, aviation due to declining crude prices, bottom-up picks in fertilizer, and smaller FMCG stocks, while an additional 5–7% decline in the IT index would present an attractive buying opportunity.