Indian Stock Markets Exhibit Cautious Close After Early Rally Fades
The Indian equity markets concluded Thursday's trading session on a cautious note, unable to maintain the robust gains witnessed during the initial hours. This marked a significant shift in momentum as the benchmark indices snapped their three-session losing streak, yet the overall sentiment remained tempered by profit-booking and global cues.
Benchmark Indices Register Modest Gains
The Sensex surged by 398 points, equivalent to 0.49%, to finish at 82,307.37. Similarly, the Nifty 50 climbed 132 points, or 0.53%, closing at 25,289.90. These gains, though positive, reflected a cautious approach from investors who seemed hesitant to extend the rally beyond the opening highs.
Strong Opening Followed by Global Optimism
Earlier in the day, the markets opened on a strong footing, mirroring a rally in global equities. The Sensex opened higher by 550.03 points, or 0.67%, at 82,459.66, while the Nifty 50 commenced trading 186.65 points, or 0.74%, up at 25,344.15. The Bank Nifty index also joined the upward trend, gaining 393.95 points, or 0.67%, to open at 59,194.25.
This initial surge was largely driven by improved investor sentiment globally, fueled by signs of cooling geopolitical tensions. Notably, US President Donald Trump announced that a "framework of a future deal" over Greenland had been agreed upon and retracted threats to impose tariffs on European countries, which bolstered market confidence.
Global Markets and Sectoral Performance
Asian markets traded higher throughout the session, and the US stock market rallied overnight, with the S&P 500 posting its most significant one-day percentage gain in two months. This positive global backdrop provided a supportive environment for Indian equities.
On the domestic front, specific stocks such as Eternal Limited, IndiGo, Adani Green, and Dr Reddy's gained traction due to positive company-specific news. Additionally, the Reserve Bank of India's (RBI) January bulletin remained optimistic about India's growth outlook, projecting a GDP growth rate of 7.4% for the fiscal year 2025-26 (FY26), which further underpinned market sentiment.
Precious Metals Witness Sharp Decline
In contrast to the equity markets, gold and silver prices traded sharply lower in the domestic market. MCX gold price fell below the psychological mark of ₹1.5 lakh per 10 grams, while MCX silver price declined by 4%, slipping below ₹3.10 lakh per kilogram levels. This decline in precious metals prices often indicates a shift in investor preference towards riskier assets like equities during periods of improved market sentiment.
Investors are advised to stay updated with the latest developments in both equity and commodity markets to make informed decisions. The cautious close suggests that while the immediate bearish phase may have paused, volatility could persist in the coming sessions.
