Indian equity markets opened higher on Thursday, with the Nifty 50 index touching a new record high, buoyed by positive global cues and ongoing optimism about China’s stimulus measures. The benchmark Sensex and Nifty indices started the day on a positive note, following trends in the GIFT Nifty that indicated gains for the broader index.

As of 9:30 am, the Sensex was trading at 85,167.56, while the Nifty 50 opened at 26,005.40, surpassing its previous record close. The market’s upward momentum was supported by a strong performance in Asian markets and gains in US stock futures.

Deepak Jasani, Head of Retail Research at HDFC Securities, commented on the market situation, saying, “Asian equities mostly rallied Thursday as fresh signs of vigor in technology stocks spread across Asia. Nifty 50 recovered from the day’s low in the last leg of the trade to end September 25 at a record close for the fourth consecutive session.”

The top gainers on the NSE in early trade included Maruti (1.70 per cent), SBI Life (1.40 per cent), Nestle India (1.20 per cent), LTIMindtree (1.17 per cent), and Wipro (1.13 per cent). On the other hand, the top losers were Hero Motocorp (-2.32 per cent), ONGC (-1.36 per cent), Power Grid (-0.85 per cent), Hindalco (-0.78 per cent), and NTPC (-0.69 per cent).

Sectoral performance showed mixed results, with IT, auto, and banking stocks showing strength, while metal and power stocks faced some selling pressure. The media index gained over 3 per cent in the previous session, indicating continued interest in the sector.

Prashanth Tapse, Senior VP (Research) at Mehta Equities Ltd, provided insight into the market sentiment, stating, “Strong Asian market undercurrent could see domestic benchmarks log early gains, with key indices holding above their highest levels on the back of a liquidity-driven rally. Markets could turn choppy intra-day amid today’s current month F&O expiry as investors would look to wind up their open positions.”

The positive market sentiment was further bolstered by the performance of global markets. Asian stocks extended their rally, fueled by optimism over China’s aggressive stimulus package. US stock futures were also trading higher, led by tech stocks, particularly following strong earnings from chipmaker Micron Technology.

Ameya Ranadive, Sr Technical Analyst at StoxBox, offered a technical perspective on the market, noting, “Immediate support is observed near 25790, and maintaining a closing level above this zone would enable the index to sustain bullish momentum.”

The market’s performance comes against the backdrop of mixed global economic signals. While US new home sales fell last month, mortgage applications rose to their highest level since 2022, driven by homeowners seeking to refinance their loans as interest rates decline.

Investors are closely watching several key events and data releases that could impact market sentiment. These include Federal Reserve Chair Jerome Powell’s upcoming speech, the release of the PCE price index (the Fed’s preferred inflation gauge), US Q2 GDP data, and jobless claims figures.

Vikas Jain, Head of Research at Reliance Securities, highlighted the importance of these events, saying, “Today’s focus will be on the US Fed Chair’s speech, along with US GDP and jobless claims data.”

Foreign institutional investors (FIIs) sold equities worth ₹973 crore on September 25, while domestic institutional investors bought equities worth ₹1,778 crore on the same day, indicating a divergence in institutional investor sentiment.

As the market heads into the monthly futures & options (F&O) expiry, volatility is expected to remain elevated. Hardik Matalia, Derivatives analyst at Choice Broking, advised, “Traders holding long positions are advised to maintain them, with a trailing stop loss set at 25,750 on a closing basis.”

With the Nifty breaking past the 26,000 level and setting new records, market participants are keeping a close eye on key resistance and support levels. The ongoing rally in global tech stocks, particularly in the semiconductor sector, is expected to have a positive influence on domestic IT stocks.

As the day progresses, investors will be watching for any developments in global markets, economic data releases, and sector-specific news that could impact trading sentiment and market direction.

Published on September 26, 2024