Benchmark equity indices opened marginally lower on Thursday, dragged by index heavyweights Reliance Industries, financial and IT stocks, as continued foreign fund outflows and tepid corporate earnings dampened market sentiment.
The BSE Sensex was down 300 points, or 0.16%, at 79,810, while the Nifty50 fell 29 points, or 0.12%, to 24,279 around 9:30 am.
Foreign portfolio investors (FPI) have offloaded Indian shares for 23 sessions in a row, with the monthly outflows of about $11 billion set to surpass the previous highest in March 2020.
The sustained selling comes as foreign investors redirect funds to China from other markets like India due to Beijing’s stimulus measures and relatively cheaper valuations.
Alongside FPI selling, weak September-quarter corporate earnings have pressured Indian markets.
Volatility (India VIX) surged to 16.05 by October 31, up from 12.79 at September’s end, marking the sharpest rise since May 2024 ahead of the general elections.
From the Sensex stocks, Tech Mahindra, Infosys, TCS, Titan, HCL Tech opened with cuts, while L&T, Sun Pharma, Axis Bank, HUL, and JSW Steel opened with gains.
L&T shares were the top Sensex gainers, rising over 5% in early trade after the company reported a profit increase for the September quarter, driven by swift project execution.
Biopharmaceutical company Biocon‘s shares opened 6% lower after the firm posted a second-quarter loss, impacted by a deferred tax charge.
On the sectoral front, Nifty IT dropped over 2%, led by losses in Mphasis, LTTS, and Tech Mahindra. Nifty Bank, Auto, Financial, FMCG, Metal, and Consumer Durables also opened up to 1% lower.
Experts Take
“This Diwali it is unlikely to see fireworks in the market. India has been underperforming in October with Nifty down 5.7% when markets in US and Japan have delivered positive returns and China and Hong Kong have hugely outperformed. India’s underperformance is driven by lofty valuations, relentless FII selling and concerns over slowing earnings growth,” said Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
“In the near-term, this scenario is unlikely to change, reversing the trend decisively, even though mild pullbacks are possible,” Vijayakumar added.
Hardik Matalia, Derivative Analyst at Choice Broking, said, “After a negative opening, Nifty can find support at 24,200 followed by 24,050 and 23,950. On the higher side, 24,400 can be an immediate resistance, followed by 24,500 and 24,750.”
Global Markets
Asian stocks slid on Thursday as chip-sector stocks tracked overnight declines by Wall Street peers and Facebook owner Meta Platforms warned of accelerating costs for artificial intelligence.
Japan’s Nikkei share average fell 0.5%. South Korea’s Kospi dropped 1.3%. Hong Kong’s Hang Seng added 0.2%, but mainland Chinese blue chips slipped 0.7%.
S&P 500 futures eased 0.35%, while Nasdaq futures dipped 0.47%. The Philadelphia SE semiconductor index slumped 3.35% overnight, with Advanced Micro Devices tumbling more than 10% following dour forecasts. EUROSTOXX 50 futures and DAX futures both eased 0.4%, while FTSE futures fell 0.1%.
FII/DII Tracker
The foreign institutional investors (FIIs) sold equities worth Rs 4,613 crore on October 30, while domestic institutional investors bought equities worth Rs 4,518 crore on the same day.
Crude Oil
Oil prices rose on Thursday, extending the previous day’s rally, driven by optimism over US fuel demand following an unexpected drop in crude and gasoline inventories, while reports that OPEC+ may delay a planned output increase offered support.
Brent crude futures gained 35 cents, or 0.5%, to $72.90 a barrel. US West Texas Intermediate crude futures climbed 32 cents, or 0.5%, to $68.93 per barrel.
Both contracts rose more than 2% on Wednesday, after falling more than 6% earlier in the week on the reduced risk of wider Middle East war.
Currency Watch
The Indian rupee opened flat at 84.08 against the US dollar in early trade. The dollar index, which tracks the movement of the greenback against a basket of six major world currencies, increased 0.14% to 104.14 level.
(With inputs from agencies)
More to come…
