Mumbai: The Indian markets commenced their trading day on Friday, witnessing gains following a rally across global stock markets. Both benchmark indices, the Nifty 50 and the Sensex, experienced positive movements at the onset of trading.
The Nifty 50 index saw a significant increase of 0.79 per cent, or 191 points, reaching a closing value of 24,334.85. Concurrently, the BSE Sensex advanced by 646 points, or 0.82 per cent, to open at a value of 79,751.90.
The global markets have adeptly navigated a turnaround from the sell-off that occurred on August 5, which was precipitated by concerns over a potential US recession and the unwinding of Yen carry trades. The latest data on US inflation and unemployment suggest no signs of an economy on the brink of recession.
"Strong global signals are favorable for the Indian markets. Among the three global risks at the start of the week, each has significantly diminished. Diplomacy has averted an attack on Israel by Iran. The latest figures on US inflation and unemployment indicate a deflationary trend, and lower numbers for unemployment benefit claims bolster the prospects of a soft landing for the US economy," stated Ajay Bagga, an expert in Banking and Markets.
He further noted, "For India, the primary concern remains the persistent outflow of Foreign Portfolio Investment (FPI), which has removed nearly $2.8 billion from the cash equities segment this month. The markets are currently in a consolidation phase and may be poised for another attempt at achieving all-time high levels in the coming week."
Within the broad market indices, the Nifty Midcap 50, Nifty Small Cap 100, and Nifty Micro Cap 250 indices all experienced gains exceeding 1 per cent at the start of the session. The other indices also exhibited positive movements.
In terms of sectoral indices, the Nifty Auto, Nifty Media, and Nifty IT sectors led in gains, with increases exceeding 1 per cent. The Nifty Bank sector also saw a rise of 0.91 per cent.
Regarding the Nifty 50 stocks list, there was a mix of gains and declines, with 46 stocks advancing and 4 stocks experiencing a decline at the time of this report.
"True strength may emerge if the indices manage to surpass the levels of 24,500/8,000, thereby pulling the market towards a value of 24,900/8,200. Our recommendation is to reduce positions in weak long holdings until the market trades below 24,500 levels. The Bank-Nifty index is currently sustaining above the 50-day Simple Moving Average (SMA) level but is struggling to exceed the level of 50,500. As long as the index does not cross 50,500, it is anticipated to remain in a range-bound state," concluded Shrikant Chauhan, the Head of Equity Research at Kotak Securities.
In the Asian markets, the Nikkei 225 index experienced a significant surge, climbing approximately 3 percent to reach 37,800 points. Similarly, the Hong Kong Hang Seng index saw a substantial increase of over 1.70 percent, while the Taiwan Weighted index recorded a gain of 1.95 percent. The South Korean KOSPI also participated in the upward trend, witnessing a 1.75 percent surge.
Within the United States, the S&P 500 index saw a notable increase of 1.61 percent, accompanied by the Nasdaq rallying with a gain of 2.34 percent on Thursday.
On Wednesday, domestic indices concluded a session marked by volatility on a positive note. The Sensex advanced by 149.85 points, or 0.19 percent, to close at 79,105.88. Concurrently, the Nifty 50 index showed a marginal increase of 4.75 points, or 0.02 percent, reaching 24,143.75. The Indian stock market was closed on Thursday in observance of Independence Day 2024.
