Stock Market Watch: Banking, Metals, Pharma — What’s Heating Up and Cooling Down Next Week?

Ahead of the upcoming trading session, the technical and derivatives research report of SBI Securities indicates upswing potential in key sectors from Pharmaceuticals to banking and financial services industry.

Bank Nifty Outlook

The Banking benchmark index Bank Nifty has been consolidating in a narrow range since the last couple of weeks. Currently, it is on the verge of giving consolidation breakout, according to the aforementioned report. On Thursday, May 22, 2025, the index found support near its 20-day EMA and has since resumed its upward trajectory. The daily RSI is inching towards the 60 level and continues to gain momentum, indicating strengthening bullish sentiment.

Additionally, the ratio chart of Bank Nifty versus Nifty has bounced off its 50-day EMA, highlighting emerging relative strength in the banking index. This signals that Bank Nifty could start outperforming the broader market.

As per the SBI securities report, "Within the index, heavyweight components such as HDFC Bank, ICICI Bank, and Axis Bank are also showing promising signs—they are all on the verge of breaking out of their respective consolidation patterns on the daily chart. This alignment across multiple key stocks adds to the conviction that a broader breakout in the index may be around the corner."

"Talking about crucial levels, the zone of 55700-55800 is likely to act as a crucial hurdle for the index. Any sustainable move above the level of 55800 will lead to sharp upside rally upto the level of 56500, followed by 57200 in the short term. While, on the downside, the 20-day EMA zone of 54800-54700 is likely to act as a crucial support for the index," it said.

Bullish outlook On Metal Sectors: Key Factors That Buoy It

The broader trend of the Nifty Metal index remains firmly bullish, as it continues to trade above both its short and long-term moving averages—each of which is trending upward. The daily RSI also reflects bullish momentum, steadily rising within the positive territory.

At present, the index is hovering near a crucial resistance zone around its prior swing high of 9305. A decisive and sustained breakout above this level could pave the way for a sharp rally toward 9500 and potentially 9700 in the short term.

On the flip side, the zone of 9130–9100 is expected to offer strong immediate support, keeping the uptrend intact as long as this level holds. The report also mentioned that the public sector undertaking (PSU) Hindustan Copper Ltd. and Bharat Heavy Electricals Ltd. (BHEL)  is expected to witness an uptick in stock price movement.

Pharma Sector Outlook: Sideways

Nifty Pharma index has been in the sideways zone for the last couple of weeks. The zone of 22000-22100 will be the crucial hurdle for the index. Any sustainable move above the level of 22100 will lead to sharp upside rally upto the level of 23000 in the short term. While, on the downside, the zone of 20700-20600 will act as immediate support for the index.

Apart from this, sectors like Nifty CPSE, PSE, Insurance, and Capital Markets are expected to continue their outperformance in the near term. Indicating positive signals from other stocks in the financial services and insurance vertical, it mentioned, 'Jio Financial Services Ltd. and ICICI Prudential Life Insurance to likely witness bullish momentum in the short term.'

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