Indian equity markets began Tuesday's trading session on a negative note, mirroring weak signals from global peers. The benchmark indices, BSE Sensex and Nifty50, opened in the red, extending the cautious sentiment from the previous session.
Market Opens Lower Amid Global Pressure
At the opening bell, the BSE Sensex was down over 120 points, while the Nifty50 slipped below the 25,950 mark. By 9:19 AM, the Nifty50 was trading at 25,902.85, marking a decline of 39 points or 0.15%. Similarly, the Sensex stood at 84,567.40, also down by 128 points or 0.15%.
The downturn was primarily influenced by mixed global cues. Wall Street's key indices ended lower on Monday, with heavyweight technology stocks leading the decline after a recent rally. This cautious mood spilled over into Asian markets on Tuesday, pausing a seven-day rally in regional stocks.
Expert View: A Range-Bound Market Awaits Direction
Market experts believe the stock market is likely to remain range-bound in the near term, with investors closely watching macroeconomic indicators and institutional fund flows for clear direction.
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, provided his analysis. He noted that while the year-end trend appears weak, it does not necessarily signal a major directional shift for the market. He pointed out that the previous day's decline of about 100 points in the Nifty occurred on thin trading volumes, which lessens its significance.
"A clear directional change will happen only early in the new year when large institutions are back in action," Dr. Vijayakumar stated. He advised investors to adopt a watchful stance for now, waiting for new triggers to emerge. However, he suggested that the current market weakness could present an opportunity to gradually accumulate high-quality large-cap stocks.
He also highlighted the importance of upcoming auto sales data, expected in two days, as a key indicator. "The auto sales numbers... will give an indication of the sustainability of the consumption boom in the economy. This is significant from the economic growth perspective, too," he added.
Broader Market and Currency Movements
The volatility was not confined to equities. In the commodities space, precious metals like gold and silver showed fluctuations after retreating from their recent all-time highs. In currency markets, the US dollar held steady as traders awaited the release of the Federal Reserve's minutes from its December policy meeting.
On the domestic institutional front, data showed a divergent trend. Foreign Portfolio Investors (FPIs) continued to be net sellers, offloading equities worth Rs 2,760 crore on Monday. In contrast, Domestic Institutional Investors (DIIs) provided a cushion to the market, emerging as net buyers to the tune of Rs 2,643 crore.
As the year draws to a close, the market appears to be in a consolidation phase, digesting global developments and positioning itself for the fresh momentum expected with the new calendar year.
