Mumbai, Oct 15: Indian equity markets opened higher on Thursday, with information technology (IT), fast-moving consumer goods (FMCG), automobile and private banking stocks leading early gains despite weak global market cues and concerns over rising US inflation.
The BSE Sensex opened at 72,965.80, gaining 183.91 points or 0.25 per cent, while the NSE Nifty 50 started the session at 22,671.30, up 48.60 points or 0.21 per cent.
Sectoral performance remained mixed during early trading. The Nifty IT, FMCG, Auto and Private Bank indices emerged among the leading gainers, advancing by up to nearly 2 per cent. In contrast, the Nifty Metal index declined around 1 per cent, while public sector banks, consumer durables, pharmaceuticals and healthcare stocks also faced selling pressure.
Global Market Weakness Weighs on Investor Sentiment
The positive opening in domestic markets came against a challenging international backdrop, as concerns over persistent US inflation and the possibility of further monetary tightening weighed on global equities.
US inflation rose to 3.7 per cent in September from 3.4 per cent in August, according to the figures cited in the market update. The increase heightened concerns that the US Federal Reserve could consider another interest rate hike, prompting investors to reduce exposure to riskier assets.
On Wednesday, the technology-heavy Nasdaq Composite declined 1.88 per cent as selling pressure intensified in technology and artificial intelligence-related stocks. Asian markets also came under pressure, with Japan’s Nikkei falling more than 4 per cent and South Korea’s Kospi declining over 7 per cent.
However, the correction in global technology stocks could have implications for foreign investment flows into India. Market participants are watching whether a shift in global investor preferences away from highly valued AI-related stocks could encourage foreign institutional investors to reassess their exposure to Indian equities.
Domestic Institutional Investors Provide Support
Institutional investment activity remains an important factor influencing the direction of domestic equities. On Wednesday, foreign institutional investors (FIIs) were net sellers, offloading Indian equities worth approximately Rs 1,857 crore.
Domestic institutional investors (DIIs), however, provided support by purchasing shares worth around Rs 2,670 crore on a net basis. Their buying helped cushion the impact of foreign fund outflows and highlighted the importance of domestic investment flows in sustaining market stability.
Investors are likely to track institutional trading patterns closely, alongside global economic developments, corporate earnings and movements in major sectoral indices, to assess the market’s near-term direction.
Technical Indicators Signal a Cautious Recovery
Technical indicators suggest that the market is attempting to recover some momentum, although uncertainty remains. The Nifty formed a bearish-leaning candlestick pattern in the previous session, reflecting continued caution among traders.
The Relative Strength Index (RSI) stood at 41.66, above its average of 32.01. While the reading indicates an improvement in momentum, it also suggests that buying strength remains an important factor to watch before a sustained recovery can be established.
Crude Oil Prices and Global Risks in Focus
Crude oil prices declined nearly 2 per cent as investors weighed supply risks around the Strait of Hormuz against developments aimed at reducing shipping costs. Movements in crude prices remain significant for India because the country relies heavily on imported oil.
Lower oil prices can ease import costs and provide some relief on inflation and the current account, although geopolitical tensions and fluctuations in global energy markets continue to pose risks.
Going forward, domestic equities are expected to remain sensitive to global inflation trends, US Federal Reserve policy expectations, foreign investor flows and corporate earnings developments. While gains in IT and FMCG stocks supported the market’s opening on Thursday, sustained buying and improving global sentiment will be important for determining whether the early recovery can continue through the session.