Sensex, Nifty open cautiously higher, lose early gains amid rising crude prices

MUMBAI: The Indian equity markets opened on cautiously positive note on Friday. Both benchmark indices opened with a gap-up, however, failed to sustain yesterday’s recovery due to surging crude oil prices and overnight losses.

The Sensex opened at 77,701.07 against the previous close of 77,537.72, rising over 160 points while the Nifty opened at 24,284.05 against pervious close of 24,231.85. At the time of reporting, the Nifty was trading around 24,221.35, down 10.50 points, or 0.04 per cent, while the Sensex was trading around 77,493.20, down 44.52 points, or 0.06 per cent.

Most broader market indices traded in the red, while most sectoral indices also remained under pressure. However, metal and private bank indices traded in positive territory during early trade. On NSE, Kotak Bank, Hindalco, HDFC Bank, Tata Steel, Power Grid, Coal India, Eicher Motor, Axis Bank, Bajaj Finance, NTPC, ONGC among others traded in the green while TCS, Titan, Grasim, Infosys, HCLT Tech, Indi Go, LT, JSW Steel, ITC among others traded in the red.

Likewise, on BSE, Kotak Bank, BEL, Tata Steel, HDFC Bank, Axis Bank, SBI, ICICI Bank, among others were the major gainers. TCS, HCL Tech, Hindustan Unilever, M&M, ITC, Reliance, LT, Tech Mahindra among others were the major losers.

Market and banking expert Ajay Bagga noted, “Asian markets today are trading defensively into that overnight yield reversal. Asian bonds declined and the dollar stayed under pressure as investors bet that US efforts to contain borrowing costs through buybacks may offer only temporary relief. This follows a sharp one-day rebound Thursday — South Korea’s KOSPI had surged around 6% on a chipmaker rebound and Japan’s Nikkei gained roughly 1.3% to above 66,000 — that risks unwinding as yields resume climbing”.

According to Bagga, India benefits from an Anti-AI momentum flow, however, elevated oil prices pose a risk of inflation and tighter monetary policy constricting the robust macro down the line.

Devarsh Vakil, HSL Prime Research, noted, major US stock indexes suffered sharp declines as a brief reprieve in the bond market abruptly reversed. He further noted, despite recent efforts by the Treasury Department to boost long-term government debt buybacks, investor anxiety over persistent inflation and rising national debt pushed 10- and 30-year Treasury yields higher, weighing heavily on equities.

“While Crude prices rose to one-month highs after President Trump threatened ‘tremendous economic consequences’ on nations trading with Iran,” he said, noting, “Asian markets opened lower today but are now recovering, tracking a sharp pullback on Wall Street as long-dated US Treasury yields rebounded”.

In the commodity market, Brent crude was trading at around USD 93.42 per barrel while crude oil was trading at around USD 86.37 per barrel at the time of reporting.

As per Market analyst Vipin Dixena, the market is entering today’s session with a cautiously positive bias. “I would not read this as a confirmed trend reversal yet, particularly with crude oil near $94 and global bond-market stress still keeping investors cautious,” he stressed.

“Technically, I see 24,300-24,400 as the key resistance zone for Nifty today. A sustained move above 24,400 could strengthen the recovery towards 24,500, while 24,000 remains the crucial downside support. Until Nifty decisively crosses the resistance zone, I would treat the current move as a recovery within a broader consolidation rather than an established uptrend”, Dixena noted. (ANI)