Indian Equity Markets Open Lower Over Weak US Signals

Indian equity markets started the day on a bearish note on Friday, reflecting negative sentiment from the US stock exchanges.

As of 9:24 AM, the benchmark Sensex had dipped by 142 points, or 0.17%, settling at 81,469, while the Nifty fell 36 points, or 0.12%, to trade at 24,960.

Investors showed caution, particularly in the banking sector, where the Nifty Bank index dropped by 204 points, or 0.40%, reaching 51,326.

Among the major indices, HCL Tech, Wipro, Tata Steel, Tech Mahindra, and Sun Pharma led the gainers in the Sensex pack. However, several heavyweights such as Bharti Airtel, Bajaj Finance, Asian Paints, ICICI Bank, and HDFC Bank were among the biggest losers.

In contrast to the overall trend, midcap and smallcap indices showed resilience, with the Nifty Midcap 100 index up by 79 points, or 0.13%, at 58,995, and the Nifty Smallcap index rising by 39 points, or 0.18%, to 18,939.

Sector performance revealed that indices related to IT, PSU banks, pharmaceuticals, metals, media, and commodities were performing well. Conversely, the auto, financial services, FMCG, real estate, and energy sectors faced declines.

Asian Markets Rally Following US Market Decline

Asian markets exhibited a more optimistic outlook, with Tokyo, Seoul, Hong Kong, Bangkok, and Jakarta showing gains. This follows a lackluster performance in the US markets, which closed lower on Thursday.

Market analysts suggest that volatility is likely to persist in the near term due to a tug-of-war between selling by foreign institutional investors (FIIs) and buying by domestic institutional investors (DIIs).

They noted, “Market is likely to remain volatile in the near-term alternating between FII selling and DII buying. Attractive valuations in other markets, particularly in Chinese stocks, will facilitate further selling by FIIs in India since Indian valuations are elevated. Concerns of earnings downgrades in H2 FY 25 render Indian valuations difficult to sustain.”

Despite the challenging market conditions, experts pointed to a positive trend in leading private sector banks, which continue to attract investor interest and demonstrate resilience even amid market weaknesses.

They concluded, “This segment currently offers the most attractive value in the market, presenting an opportunity for investors.”

In a recent trading session on October 10, FIIs continued their selling spree, offloading equities worth Rs 4,926 crore, while DIIs stepped in to purchase equities worth Rs 3,878 crore, reflecting the ongoing battle between the two investor classes.

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