Indian Stock Market Preview: February 19, 2026

Introduction

Indian equity benchmark indices, the Nifty 50 and the S&P BSE Sensex, are poised for a constructive gap-up opening this Thursday, February 19, 2026. This positive momentum is largely underpinned by a rebound in global technology shares and a significant surge in domestic institutional participation. On Wednesday, the Nifty 50 concluded the session at 25,819.35, marking a gain of 93.95 points (0.37%), while the Sensex advanced 283.29 points to settle at 83,734.25.

As we enter the crucial monthly Futures & Options (F&O) expiry week, market participants are navigating a landscape of mixed global signals, ranging from a landmark US-Japan trade agreement to escalating geopolitical tensions in the Persian Gulf. For retail investors, the primary focus remains on whether the index can decisively breach the psychological 26,000 mark or if profit-booking will emerge at higher echelons.

Global Market Cues

US Markets Performance

Wall Street provided a strong tailwind following Tuesday's session (February 18, 2026). The rally was characterized by a sharp recovery in the technology sector and resilient corporate earnings data.

• Dow Jones Industrial Average: Rose by 129 points (+0.3%).
• S&P 500: Gained approximately 0.6%, led by high-growth tech names.
• Nasdaq Composite: Outperformed with a 0.8% surge, reflecting a return of risk appetite in the semiconductor and software industries.

While the primary session was strong, overnight futures suggested a slight cooling off, with S&P 500 futures down 0.09% and Nasdaq 100 futures slipping 0.1%.

Asian Markets Outlook

Asian indices opened with a predominantly bullish bias on Thursday morning, catching the baton from the US rally.

Note: Hong Kong's Hang Seng and the Shanghai Composite remain closed for the Lunar New Year holiday, which may lead to lower regional trading volumes until they reopen on February 20.

GIFT Nifty Indication

The GIFT Nifty (the successor to the SGX Nifty) is currently trading at 25,842, representing a 36-point (+0.14%) premium over its previous close of 25,806. With a morning trading range between 25,752 and 25,849, the data suggests a firm start for the domestic benchmarks.

Commodity and Currency Dynamics

Crude Oil Trends: WTI Crude is currently trading at $64.01 per barrel, marking a 2.7% daily jump. This volatility stems from the collapse of Ukraine-Russia peace negotiations and provocative naval drills involving Iran and Russia. While prices are up 6% over the last month, they remain 11% lower on a year-on-year basis. For India, a sustained move above $70 would be viewed as a risk to inflation and the current account deficit.

USD/INR: The Indian Rupee remains stable near 90.78 against the US Dollar. The pair has maintained a tight range of 90.55-90.85 over the past week, aided by strategic RBI interventions.

Bullion: Safe-haven demand has spiked. Gold futures (MCX) jumped ₹4,367 to reach ₹1,55,785, while Silver surged ₹15,408 to settle at ₹2,44,191.

Technical Analysis

Nifty 50 Outlook

The Nifty 50 is currently positioned above its major moving averages, including the 21-day, 50-day, and 100-day EMAs, confirming a prevailing uptrend. The Relative Strength Index (RSI) stands at 53.91, suggesting the index is in a neutral zone with significant room for an upward move.

The India VIX (Volatility Index) dropped 3.55% to 12.22, indicating a decrease in market fear and a rise in trader confidence.

Bank Nifty Analysis

Bank Nifty has shown superior relative strength, forming a bullish "higher high-higher low" pattern. The RSI for the banking index is higher at 64.86, approaching the overbought threshold but still maintaining positive momentum.

Institutional Activity Analysis

Institutional flows provide a massive tailwind for the current session, with a combined net inflow of ₹4,901.5 crore on February 18.

FII and DII 5-Day Trend

Insight: While FIIs were heavy sellers on February 12, they have returned as aggressive buyers in the last two sessions, specifically targeting large-cap quality stocks.

Options Market Analysis

Nifty Options Chain

• Put-Call Ratio (PCR): 1.22, indicating a bullish tilt as Put writers outweigh Call writers.
• Max Call Open Interest (OI): 26,000 Strike with 1.07 crore contracts, acting as the primary ceiling.
• Max Put OI: 25,500 Strike with 90.07 lakh contracts, serving as the bedrock support.
• Recent Activity: The 25,700 Put saw an addition of 42.28 lakh contracts, strengthening the floor, while the 25,800 Call added 18.46 lakh contracts, providing immediate resistance.

Bank Nifty Options

• Max Call OI: 62,000 strike (8.33 lakh contracts).
• Max Put OI: 61,000 strike (11.86 lakh contracts).
• Range Expectation: 61,000 - 62,000 for the weekly expiry.

Stocks to Watch: February 19, 2026

1. ITC Limited (ITC)

• Reason: UBS maintains a 'Buy' rating with a target of ₹395. Market anticipates imminent cigarette price hikes: 84mm sticks to ₹24 (from ₹17), 64mm sticks to ₹7 (from ₹5.9), and 69mm Goldflake to ₹12 (from ₹9.5).
• Strategy: Buy on dips near ₹328-332; Stop-loss at ₹320.

2. Infosys (INFY)

• Reason: BofA maintains a 'Buy' with a target of ₹1,840. AI-first offerings now contribute 5.5% to revenue. However, the stock is in a sideways trend with support at ₹1,340.
• Strategy: Wait and watch; avoid fresh trades unless it breaks above ₹1,410.

3. Cochin Shipyard (COCHINSHIP)

• Reason: Named L1 bidder for a ₹5,000 crore defense order and signed a ₹2,000+ crore deal for six LNG-powered feeder vessels.
• Strategy: Breakout watch above recent highs.

4. Dr Reddy's Laboratories (DRREDDY)

• Reason: Strategic acquisition of Progynova and Cyclo-Progynova trademarks from Mercury Pharma for $32.15 million.
• Impact: Expansion in the high-margin women's health and hormone replacement therapy segment.

5. Hindustan Unilever (HINDUNILVR)

• Reason: Approved a ₹2,000 crore capex plan over two years to expand premium manufacturing capacity.
• Impact: Positive long-term bet on India's premiumization trend.

6. Zydus Lifesciences (ZYDUSLIFE)

• Reason: Final USFDA approval for Bosentan tablets (32 mg) for Pulmonary Arterial Hypertension.

7. Aurobindo Pharma (AUROBINDO)

• Reason: Received USFDA approval for Adquey (atopic dermatitis), with a brand potential of $250-300 million.
• Target: ₹1,415 (HSBC).

8. NCC Limited (NCC)

• Reason: Debarred by NHAI from participating in tenders for two years effective Feb 17, 2026.
• Strategy: Avoid/Sell on rise; expect significant downward pressure.

9. Reliance Industries (RELIANCE)

• Reason: Technical bias is positive; stock is trading above key moving averages.
• Strategy: Buy on dips at ₹1,420; Target ₹1,475.

10. State Bank of India (SBIN)

• Reason: Strong momentum in PSU banking and improving asset quality.
• Strategy: Buy on dips near ₹1,200; Target ₹1,235-1,250.

Scheduled Events and Corporate Actions

• Quarterly Results: ABB India (Q3 results and potential dividend) and CIE Automotive India (Q3 results) are the key large-cap earnings to track today.
• F&O Expiry: Today marks the monthly expiry, leading to accelerated option decay and potential sharp moves in the final hours (2:00 PM - 3:30 PM).
• Macro Events: The US-Japan Trade Deal ($550 billion investment into the US) and the AI Impact Summit 2026 are expected to influence technology and global trade sentiment.

Sectoral Outlook

• Banking & Financials: Positive. Bank Nifty is showing strong relative strength. PSU banks like SBI and Bank of India are in focus.
• IT Services: Neutral/Cautious. Technical damage post-Feb 18 selling suggests waiting for stabilization in names like Infosys.
• Pharmaceuticals: Positive (Selective). Driven by a flurry of USFDA approvals (Zydus, Aurobindo, Dr Reddy's).
• Capital Goods/Infra: Positive. Strong order book visibility for Cochin Shipyard and ABB India.
• FMCG: Mixed. Sector specific moves expected; ITC is the preferred pick due to pricing power.

Key Takeaways

• Positive Opening: GIFT Nifty at 25,842 suggests a 36-point gap-up.
• Institutional Strength: Combined FII and DII buying of ₹4,900 crore provides a strong safety net.
• Resistance at 26,000: 1.07 crore Call contracts at this strike make it a formidable barrier for Nifty.
• Crude Oil Concern: A 2.7% spike in oil to $64.01 is a macro variable that needs constant monitoring.
• Expiry Volatility: Expect heightened swings as traders roll over positions for the next month.

What This Means for Investors

Historical trends during monthly F&O expiry weeks indicate that volatility often spikes near major psychological levels. With Nifty approaching 26,000, investors should avoid "chasing" the gap-up. Data suggests that the risk-reward is more favorable when buying near support zones like 25,600-25,720.

Long-term investors may consider maintaining their SIP approach in quality banking and pharmaceutical names, as institutional accumulation remains robust. However, caution is advised in mid-caps and small-caps that lack earnings support, particularly in the infrastructure space following the news regarding NCC Limited.

Monitor: Watch the India VIX; a spike above 13.5 would signal increasing nervousness in the market.