Indian stock markets began Thursday's trading session on a negative note, with the key benchmark indices slipping into the red amid weak global cues. The domestic market sentiment was impacted by a selloff in technology shares on Wall Street, driven by concerns over the artificial intelligence (AI) trade.
Market Opening and Key Levels
At the opening bell, the BSE Sensex was down by approximately 150 points, trading at 84,412.18, marking a decline of 0.17%. The broader Nifty50 index was below the 25,800 mark, opening at 25,784.80, down 34 points or 0.13%. Market analysts indicate that the overall sentiment remains weak in the near term.
Experts suggest that the Nifty index is likely to find crucial support in the zone of 25,700 to 25,650. On the upside, any attempt at a recovery is expected to face strong resistance at the 25,950 to 26,000 levels.
Expert Insight: FII Strategy and Global Impact
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, provided a critical analysis of the market dynamics. He pointed out that the trend of a weakening AI trade is accelerating in the U.S. market and is likely to persist into early 2026. "This trend will favour non-AI markets like India," he noted.
Highlighting a key observation from Wednesday's trade, Dr. Vijayakumar said, "Despite FII buying and net institutional buying, the market drifted down. The reason might be the FIIs increasing their short positions." This activity suggests that Foreign Institutional Investors (FIIs) may resort to a 'sell on rally' strategy in the near term, creating headwinds for a sustained upward move.
Global and Institutional Cues
The weakness in Indian equities mirrored a risk-averse sentiment across global markets. On Wednesday, US stock markets finished lower, with the S&P 500 and Nasdaq Composite hitting three-week lows as anxiety over high-flying AI stocks rattled the technology sector. This pessimism flowed into Asian markets, which also opened lower on Thursday.
The flight to safety bolstered short-term US Treasuries and precious metals. Back home, the institutional flow data painted a mixed picture. On Wednesday, Foreign Portfolio Investors (FPIs) were net sellers to the tune of Rs 1,172 crore. In contrast, Domestic Institutional Investors (DIIs) provided support by purchasing shares worth Rs 769 crore.
The confluence of global tech worries and a cautious stance by foreign investors is currently weighing on market sentiment. Investors are advised to watch the identified support and resistance levels closely, along with further cues from global markets and institutional activity.
