Indian stock markets began Wednesday's trading session on a negative note, with both key benchmark indices slipping into the red. The decline reflected a cautious mood among investors, balancing domestic corporate optimism against persistent global uncertainties.
Opening Bell: Indices Trade Lower
At the opening bell, the BSE Sensex was down over 100 points, while the Nifty50 index fell below the 26,150 mark. By 9:18 AM, the Nifty50 was trading at 26,132.00, marking a decline of 47 points or 0.18%. Simultaneously, the BSE Sensex stood at 84,953.09, recording a loss of 110 points or 0.13%.
Analysts Decode the Market Mood
Market experts believe that equity markets are likely to move within a narrow range in the short term. The optimism generated by encouraging third-quarter business updates from Indian companies is being counterbalanced by lingering geopolitical risks.
Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, provided a detailed perspective. He noted that recent market movements have lacked a clear trend or direction. "Actions in a few mega stocks are influencing the overall market disproportionately," he stated.
He illustrated this by pointing to Tuesday's session, where the Nifty declined by 71 points despite positive institutional buying. This drop was primarily driven by sharp falls in two heavyweight stocks: Reliance and HDFC Bank. Dr. Vijayakumar attributed this movement to technical factors related to the settlement day, indicated by large volumes in both the derivative and cash markets, rather than any change in the companies' fundamentals.
Looking ahead, he warned of potential high volatility triggered by external events and news. "Trump tweets and actions can always influence the market," he remarked. Another critical event for investors to monitor is an impending possible Supreme Court verdict on Trump-era tariffs. A verdict against the reciprocal tariffs could induce significant volatility in stock markets globally.
Global and Institutional Cues
Global market signals were mixed on Wednesday. Wall Street had closed higher on Tuesday, buoyed by a strong rally in semiconductor stocks fueled by renewed enthusiasm around artificial intelligence. The Dow Jones Industrial Average climbed to a fresh record high, and shares of Moderna also advanced.
However, Asian markets paused after a strong start to the year. Japanese equities witnessed declines amid rising regional tensions, prompting investor caution despite the broader strength in global stocks in 2024 so far.
On the institutional flow front, data showed a divergent picture for Indian markets. Foreign Portfolio Investors (FPIs) were net sellers of Indian equities worth Rs 107 crore on Tuesday. In contrast, Domestic Institutional Investors (DIIs) continued to be net buyers, providing support to the market with net purchases amounting to Rs 1,749 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 this publication.)
