Stock Market Indices Open Lower After Strong Rally
Following a robust rally in the previous session, the Indian stock market indices, Nifty50 and BSE Sensex, commenced trading on Tuesday in negative territory. The Nifty50 index opened below the 25,600 mark, while the BSE Sensex experienced a decline of over 200 points during the initial trading hours.
At 9:16 AM, the Nifty50 was observed trading at 25,593.50, reflecting a decrease of 89 points or 0.35%. Simultaneously, the BSE Sensex stood at 83,057.50, down by 220 points or 0.26%.
Market Resilience and Corporate Earnings Outlook
The stock market had concluded the prior day on a higher note, breaking a losing streak, primarily supported by buying activity in banking stocks. Experts suggest that the indices might continue to move within a narrow range with a slight upward bias, as investors await cues from technology stocks and developments related to artificial intelligence.
Analysts have pointed out that market attention will be directed towards Infosys’ AI-focused investor meeting and the ongoing India AI Impact Summit. These events are anticipated to influence sentiment in technology sectors and potentially guide the near-term direction of the market.
Expert Insights on Market Dynamics
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, commented, “Despite the sell-off in capital market-related stocks due to RBI’s tighter rules on loans to proprietary traders and brokers, Nifty jumped 211 points yesterday. This is a reflection of the underlying resilience of the market.”
He elaborated that this resilience primarily stems from India’s improving macroeconomic indicators and their implications for corporate earnings moving forward. “The 14.7% growth in corporate earnings reflected in the Q3 results has come better-than-expected and the momentum is set to continue in Q4, accelerating in FY 27.”
Dr. Vijayakumar added, “FIIs cannot ignore this positive development and, therefore, will turn significant buyers in India, despite the occasional selling in response to events like the AI shock impacting IT stocks. The market will respond to geopolitical developments like the US-Iran stand off. Corrections can be used as buying opportunities. The impressive credit growth happening now has positive implications for leading banking stocks which are fairly valued.”
Global Market Context and Investor Activity
Asian markets exhibited modest gains on Tuesday, although trading volumes were thin due to holidays in certain regions. Investors are awaiting a fresh set of economic data later this week for clearer signals on global growth trends.
The US dollar maintained its recent strength on Tuesday, as markets anticipated indications expected later this week regarding the timing of potential interest rate cuts by the Federal Reserve.
In terms of investor activity, foreign portfolio investors sold equities worth Rs 972 crore on Monday. In contrast, domestic institutional investors remained net buyers, purchasing shares worth Rs 1,667 crore.
Disclaimer: Recommendations and views on the stock market, other asset classes, or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India.
