Sensex and Nifty opened on a bullish note this morning, with the BSE Sensex climbing 848.15 points, or 1.07 per cent, to 79,954.03 as of 9:34 am. The broader Nifty 50 index also showed significant gains, trading at 24,393.70, up 249.95 points or 1.04 per cent from its previous close. This comes after a mild July consumer price index strengthened expectations for a September rate cut by the US Federal Reserve.
The US consumer price index slowed to a 2.9 per cent pace from a 3.0 per cent pace in June, compared with economists’ estimates for 3 per cent. Stripping out more volatile items like food and fuel, the “core” number climbed by 3.2 per cent in the twelve months to July, below projections of 3.3 per cent.
“Over the past three trading sessions, U.S. markets have climbed 5 per cent, buoyed by three key economic indicators: Tuesday’s sharp decline in U.S. wholesale inflation (PPI), Wednesday’s drop in July inflation to a nearly three-year low of 2.9 per cent (against an expected 3 per cent), and Thursday’s better-than-expected U.S. retail sales and falling jobless claims. These developments suggest that the U.S. economy is improving, further fuelling expectations of a significant rate cut by the Fed next month. Asian and European markets have also gained 2-5 per cent over the past two days,” said Vikas Jain, Head of Research at Reliance Securities.
The positive opening aligns with earlier GIFT Nifty trends that had indicated potential gains of 184 points for the broader index. Market analysts suggest that the Nifty may find support at 24,200, 24,150, and 24,050 levels, with resistance expected at 24,350, 24,400, and 24,450.
Top gainers on the NSE at 9:30 am included M&M (3.03 per cent), LTIMindtree (2.57 per cent), Tata Motors (2.53 per cent), Apollo Hospitals (2.42 per cent), and Hindalco (2.39 per cent). Conversely, HDFC Life (-1.89 per cent) and Titan (-0.10 per cent) were among the top losers.
The market’s upward trajectory comes despite recent selling by foreign institutional investors (FIIs), who offloaded equities worth ₹2,595 crore on August 14. Domestic institutional investors also sold equities valued at ₹2,236 crore on the same day.
The INDIAVIX, which measures market volatility, was down by 4.53 per cent and trading at 15.4350 on Wednesday.
Hardik Matalia, Research Analyst at Choice Broking, commented on the market outlook, stating, “Indian markets are expected to open on a positive note. However, recent FII’s selling could be a concern.” He added that traders holding long positions should maintain a trailing stop loss at 24,000 on a closing basis.
“The ongoing global market rally, positive quarterly results from domestic companies, and strong domestic economic data are expected to boost market sentiment. Moving forward, market trends will likely be influenced by global market performance, domestic news flow, and fund activities post-earnings season. Pharma, FMCG, and IT stocks are expected to perform well, given their strong quarterly results, while banking stocks appear attractive following a recent correction,” added Jain
