Indian Stock Market Opens Lower as Nifty50 and Sensex Experience Sharp Declines
Indian stock market indices, Nifty50 and BSE Sensex, faced a significant downturn during the opening trade on Thursday morning. The markets opened with notable losses, reflecting broader economic concerns and global financial trends.
Market Performance Details
At 9:16 AM, Nifty50 was trading at 25,877.80, marking a decline of 76 points or 0.29%. Meanwhile, BSE Sensex stood at 83,998.41, down by 235 points or 0.28%. This drop pushed Nifty50 below the 25,900 threshold, indicating a bearish sentiment among investors.
Expert Analysis on Market Trends
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, provided insights into the market dynamics. He highlighted that recent US jobs data, showing an addition of 130,000 jobs last month and a drop in unemployment to 4.3%, suggests that the Federal Reserve may not implement rate cuts in the near term. In India, the rate-cutting cycle appears to be over due to strong growth and expectations that inflation will return to the RBI's long-term target by the end of FY27.
Dr. Vijayakumar emphasized that market support must now come from earnings growth. Sectors such as automobiles, jewellery, hotels, certain segments of capital goods, telecom, and financials are performing well on the earnings front and have the potential to sustain this performance.
Challenges and Opportunities in Specific Sectors
Tech stocks are facing significant pressure, unlikely to recover soon due to the Anthropic shock. The sharp decline in the ADRs of top Indian IT companies in the US indicates ongoing struggles for the Indian IT sector. However, shifting investments from IT to other performing sectors could benefit stocks in those areas.
Stocks like Eicher, Titan, and Apollo Hospital have shown sharp rises in response to positive results, demonstrating that the market rewards better-than-expected earnings. Despite occasional profit booking, the market undertone remains resilient, partly because Foreign Institutional Investors (FIIs) are turning into buyers. FIIs were buyers in six of the last seven trading sessions, suggesting an end to the trend of sustained selling.
In the near term, the market is expected to consolidate around current levels with an upward bias, as per expert analysis.
Global Market Context
In the United States, the Nasdaq and Dow closed marginally lower on Wednesday, while the S&P 500 remained largely flat. A stronger-than-expected employment report alleviated concerns about economic weakness but reinforced expectations that the Federal Reserve may slow the pace of interest rate cuts.
Asian markets, however, continued their upward momentum, extending gains for a fifth consecutive session and outperforming US peers so far this year. Investors are attracted by relatively lower valuations and stronger growth prospects across the region. Meanwhile, US Treasury prices declined further after robust jobs data reinforced expectations of tighter monetary conditions.
Commodity and Investment Flows
Oil prices moved higher early Thursday due to resurfacing geopolitical concerns. Brent crude futures rose 34 cents, or 0.49%, to $69.74 per barrel at 0126 GMT, while US West Texas Intermediate crude gained 37 cents, or 0.57%, to $65.00.
On the investment front, Foreign Portfolio Investors (FPIs) remained net buyers, purchasing equities worth Rs 944 crore on Wednesday. Domestic Institutional Investors (DIIs) also contributed to equity purchases, recording net buys of Rs 125 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.
