Cautious Optimism in Indian Stock Markets Amid Global Developments
Indian stock markets saw cautious trading with slight gains as investors eye global developments and upcoming domestic policies. The Nifty 50 and BSE Sensex opened flat, while experts noted profit-booking by domestic promoters. Anticipation of a possible RBI rate cut is supporting bullish sentiment despite mixed global signals.
- Country:
- India
The Indian stock markets displayed cautious optimism on Wednesday, trading in a consolidation phase with a flat opening and modest gains. Investors are navigating a complex landscape shaped by international developments and impending domestic policy decisions.
The Nifty 50 index started at 24,560.45, marking a slight increase of 17.95 points or 0.07 percent. Similarly, the BSE Sensex also opened on a steady note, rising by 40.14 points to 80,777.65, translating to a 0.05 percent gain. Market analysts attribute this tentative market momentum to global cues and profit-booking by domestic promoters.
Ajay Bagga, a banking and market expert, highlighted potential positive signals from the international front, including the anticipation of a call between Trump and Xi that could foster US-China trade agreements. Despite tariff concerns, US markets have shown resilience, buoyed by retail investors buying on dips. Bagga also mentioned that Indian markets face mixed signals, with domestic promoters selling over USD 5 billion, causing a temporary dampening effect on sentiment. However, the larger market scale renders this impact relatively minor. The possibility of a rate cut by the Reserve Bank of India on Friday is bolstering investor sentiment, despite weak Foreign Portfolio Investor activity due to block deals.
Domestic macroeconomic conditions remain strong, underpinned by an anticipated easing monetary policy from the RBI. Broader market indices remained positive: Nifty 100 increased by 0.18 percent, Nifty Midcap rose by 0.25 percent, and Nifty Smallcap advanced by 0.29 percent. Market volatility decreased as the India VIX index declined by 1.54 percent.
Sector performance was mostly positive, with all sectors on the NSE trading higher except Nifty Consumer Durables, which saw a marginal decrease. Gains were observed in sectors like Nifty Auto, Nifty FMCG, and Nifty IT, among others. As global cues stay mixed and the RBI policy announcement looms, markets are expected to maintain this range-bound trend in the short term.
(With inputs from agencies.)
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