Indian equity markets witnessed a subdued start to the trading week on Monday, opening marginally lower as investors adopted a wait-and-watch stance ahead of a crucial US Federal Reserve policy meeting. The flat movement followed a positive rally seen in the previous weekend's session.
Market Opens in the Red Amid Global Uncertainty
The benchmark indices began the day on a cautious note. The NIFTY 50 index opened at 26,159.80, marking a decline of 26.65 points or 0.10%. Similarly, the BSE Sensex commenced trading at 85,624.84, down by 87.53 points or 0.10%. Market participants are closely monitoring global monetary cues, developments on international tariff fronts, and geopolitical tensions, all of which are expected to shape investor sentiment in the final weeks of the year.
Banking and market expert Ajay Bagga told ANI that while the recent RBI rate cut has provided support, the focus is now on global events. "For Indian markets, the RBI delivered a rate cut on Friday, leading to a boost in interest rate sensitives except for real estate players," Bagga stated. He added that a Fed rate cut would be welcomed as it could lead to a weaker US dollar and stronger inflows into emerging markets like India. The ongoing visit of a US trade delegation has also raised hopes for potential relief on tariffs, which could provide momentum for a year-end rally.
Sectoral Performance and Broader Market Trends
The opening session displayed a mixed picture across different sectors. On the National Stock Exchange (NSE), Nifty IT, Media, and Metal sectors managed to start in positive territory. However, most other sectors faced selling pressure. Notably, Nifty Auto declined by 0.3%, Nifty FMCG traded flat in the red, and Nifty Pharma was down by 0.29%, indicating selective and cautious participation from investors.
The broader market also reflected the nervous sentiment. The Nifty 100 index opened down by 0.2%. A similar downtrend was visible in the Nifty Midcap and Small Cap indices, which opened in the red, suggesting pressure on stocks outside the major index heavyweights.
Sunil Gurjar, a SEBI-registered analyst and founder of Alphamojo Financial Services, commented on the market's consolidation phase. "The Nifty 50 did not perform well last week, remaining flat. Due to this 'tug-of-war,' the index remained largely unchanged," he said. Gurjar noted that this consolidation stems from various conflicting factors but pointed out that the Nifty 50 is showing strong relative strength and inching towards a new high, with the price trading above all key moving averages.
IPO Buzz and Global Market Watch
In contrast to the cautious secondary market, the primary market remains vibrant. The IPO allotment for the e-commerce platform Meesho is set to be finalized today. The issue witnessed overwhelming demand, being oversubscribed 23.33 times overall. The retail segment was subscribed 15 times, Qualified Institutional Buyers (QIB) by 17 times, and Non-Institutional Investors (NII) by 28 times. The IPO has a price band fixed between ₹105 to ₹111 per share, with a total issue size of ₹5,421 crore.
On the global front, several factors are contributing to market uncertainty. Deteriorating relations between China and Japan are posing challenges to Asian market sentiment. Furthermore, the recent publication of a new US National Security Strategy has sparked concern among European allies and South American states, adding layers to the geopolitical landscape.
Experts believe that upcoming decisions from major global central banks will be crucial in guiding market direction. Meetings of the European Central Bank (ECB), the Bank of England, and the Bank of Japan scheduled for next week are anticipated to draw close attention. The Bank of Japan is widely expected to raise rates by 0.25%, a move that could influence carry trade dynamics, though markets have had time to price in this possibility.
Other Asian markets showed mixed sentiment during Monday's opening. Japan's Nikkei 225 was down 0.13%, Hong Kong's Hang Seng fell 0.77%, and Singapore's Straits Times declined 0.34%. South Korea's KOSPI, however, traded up by 0.22%.
