NIFTY50 Historical Trends: Can Nifty50 Maintain Strong Performance in April 2025?

SUMMARY

In the past 15 years, the NIFTY50 index has delivered positive returns in April on 9 occasions. However, its performance tends to be weaker in April if it follows a strong March. Let's explore how historical market trends and present economic conditions might influence stock performance in April.

A study of historical data shows that whenever March experiences a significant uptick, April rarely sees a large surge. Its performance is typically either negative or limited to modest gains. On March 28, 2025, the NIFTY50 closed at 23,519 levels, with a 6.3% return so far this month. So, what can we expect in April 2025?

Let's take a look at the historical returns of the NIFTY50 for March and April;

*As on 28 March 2025; MoM = Month-on-Month

What are the charts saying?

From April to September 2024, the NIFTY50 surged 17%, but then it dropped sharply, giving up all those gains between October 2024 and February 2025. However, in March, the NIFTY50 made a strong recovery and is currently around 23,610 level. This represents a 38.2% recovery from the preceding decline, a Fibonacci retracement level. How the NIFTY50 closes in March will help set the tone for FY2026.

NIFTY50 Monthly Chart October 2023 to March 2025:

Let’s dive deep into what might impact the markets in April 2025:

Transition to the new financial year

In the last five years, SIP contributions have decreased 4 out of 5 times in April on a month-on-month basis. March typically sees a high SIP investments, mostly from salaried employees making last-minute tax-saving investments to take advantage of tax deductions before the financial year ends.

Similarly, net inflows from Foreign Institutional Investors (FIIs) have been negative in 4 out of 5 Aprils over the past five years.

Corporate earnings season

Companies report their Q4 earnings and annual earnings, starting in April each year, and these results influence the stock markets. As per a leading rating agency, India Inc. is expected to see approximately 7-8% year-on-year revenue growth in Q4 FY2025, driven by a revival in rural demand and an increase in government spending.

RBI’s recent actions

RBI’s recent rate cut by 25 bps and the $10 billion dollar-rupee swap is expected to make borrowing cheaper and add liquidity translating into consumer spending.

Trump tariff uncertainties

US President Trump is anticipated to introduce reciprocal tariffs on countries imposing higher tariffs than the US, starting April 2, 2025. India, where the average tariff stands at 12% against the US’ 2.2%, is among those likely to face consequences. To protect its exports, India is considering lowering its tariffs. Such uncertainty may spark volatility in the Indian stock market during April.

The economic calendar

Finally, here are a few upcoming events that could influence the movement of Indian stock markets in April 2025.

In conclusion, we can anticipate increased market volatility this April, as optimism about government initiatives collides with global uncertainties—especially Trump's tariff strategy—prompting investors to consider whether history will repeat itself or take a new course.