The Indian stock market opened in the green on Friday, a day after Sensex saw sharp downward spikes in the fag end of its month-expiry session, spooking investors.
Sensex gained 240 points to 77,173 while Nifty 50 rose around 51 points to 24,142 on Friday. The broader markets also opened in the green, with Nifty Midcap 100 and Nifty Smallcap 100 trading up to 0.25% higher.
Tech Mahindra, Infosys, TCS and HCL Tech shares jumped 2-3% each to lead gains on Sensex, while Eternal, Sun Pharma, Tata Steel and few other stocks gained around 1% each. Bajaj Finserv, M&M, Bajaj Finance and ICICI Bank shares meanwhile declined around 1% each.
Among the sectors, Nifty IT jumped 3% to lead gains, while Nifty Auto, Nifty FMCG, Nifty Bank and few others slipped into the red. The overall market breadth remained positive, with NSE seeing 1,525 advances and 1,148 declines, while 148 stocks remained unchanged.
Today’s positive opening comes a day after the Indian stock market erased all morning gains to close in the deep red on Thursday, with Sensex seeing a sharp downturn at the fag end of the session on its first monthly expiry following the introduction of the closing auction session (CAS).
Notably, this came after Nifty had ended in the green on Tuesday on its first expiry day since the launch of CAS, which was introduced by the stock exchanges on August 3, changing the way closing prices are calculated for stocks included in the futures and options (F&O) segment.
What lies ahead for Dalal Street?
Brent crude has again surged to above $89 since there are no signs of any diplomatic solutions to reopening the Strait of Hormuz. Total lack of clarity on this issue is weighing on the market, according to VK Vijayakumar, Chief Investment Strategist at Geojit Investments. Meanwhile the AI trade continues to boom following the good results and great guidance from Nvidia, he said, adding bond yields in the US continue to remain firm following concerns on the inflation front.
All these factors have been weighing on the Indian market, keeping the Nifty within the 24,300 - 24,600 range, according to the analyst. He added that a break out above the range will happen only if some of the Nifty heavyweights like HDFC Bank, RIL, L&T and the IT majors participate in the rally. For this to happen, the major headwinds of elevated crude price and high U.S. bond yields have to disappear or at least weaken. “The commentary from the Fed chief Kevin Warsh at Jackson Hole symposium today will be keenly watched by the market for any clues on interest rates,” according to the analyst.
Despite the weakness through yesterday, Anand James, Chief Market Strategist at Geojit Investments said hopes are on 24,060 region arresting further slippages, allowing bargain hunting that could set a base for a rise.
“However, we would wait for a rise above 24,150 or 24215 to signal strength. Alternatively, inability to float above 24,060 would expose 23,575, but we do not see momentum for a vertical fall,” he added.
