Market watchers had anticipated a flat to slightly bullish start for the Indian equity markets, with the GIFT Nifty trading around 22,570, reflecting a modest increase of 25 points
The Indian stock market opened higher on Thursday, as buying activity was observed in the Financial Services and Public Sector Banks (PSU Banks) sectors, despite mixed global cues. The Sensex rose by 61.17 points, or 0.08 percent, to trade at 74,090.93, while the Nifty gained 2.15 points, or 0.01 percent, to stand at 22,472.65 by 9:31 AM. This marks a positive start as investors remain cautious ahead of the Holi festivities.
In the sector-specific movements, the Nifty Bank index was up by 113.10 points, or 0.24 percent, at 48,169.75. Meanwhile, the Nifty Midcap 100 index fell slightly by 49.80 points, or 0.10 percent, at 48,436.80. The Nifty Smallcap 100 index was down by 62.90 points, or 0.42 percent, at 14,981.45, indicating mixed sentiment in the broader market.
Global Cues and Market Sentiment
Market watchers had anticipated a flat to slightly bullish start for the Indian equity markets, with the GIFT Nifty trading around 22,570, reflecting a modest increase of 25 points. “This suggests a cautious market sentiment, influenced by global cues and the absence of strong domestic triggers. Investors will closely monitor global trends, crude oil prices, and institutional flows to assess the market’s direction,” said Hardik Matalia of Choice Broking.
In terms of global market movement, the previous trading session saw the Dow Jones Industrial Average decline by 0.20 percent to close at 41,350.93. In contrast, the S&P 500 added 0.49 percent, closing at 5,599.30, and the Nasdaq climbed 1.22 percent to end at 17,648.45. Asian markets, however, presented a mixed picture, with markets in Bangkok, Japan, Seoul, and Jakarta trading in the green, while China and Hong Kong were trading lower.
Sectoral Performance
Among the top gainers in the Sensex pack were IndusInd Bank, Tata Steel, Zomato, Bajaj Finserv, ICICI Bank, Tech Mahindra, Infosys, and SBI, with their stocks showing moderate growth in early trade. However, Hindustan Unilever Limited (HUL), Sun Pharma, Tata Motors, UltraTech Cement, and Asian Paints were among the top losers.
Despite the positive opening, experts advised caution, given the mixed global cues and ongoing uncertainty in the markets. “Given the prevailing market dynamics, traders are advised to exercise caution and wait for confirmation of price action at critical levels before initiating fresh positions,” said a market analyst.
Foreign and Domestic Institutional Activity
Foreign Institutional Investors (FIIs) were net sellers on March 12, offloading equities worth Rs 1,627.61 crore, while Domestic Institutional Investors (DIIs) made purchases worth Rs 1,510.35 crore on the same day. This divergence between FIIs and DIIs indicates a cautious outlook among foreign investors, while domestic investors continue to show confidence in select sectors, particularly in banks and financial services.
Market Volatility: A Recap of the Previous Day
On Wednesday, March 12, Indian stock markets remained highly volatile, with benchmark indices ending the session almost flat despite sharp intra-day fluctuations. The Sensex opened nearly 170 points higher at 74,270, briefly touching an intra-day high of 74,392. However, the gains were short-lived as the index dropped significantly, falling to a low of 73,598 before closing with a loss of 73 points, or 0.1 percent, at 74,030. This marked the fourth consecutive session of losses for the Sensex.
The Nifty followed a similar pattern, peaking at 22,577 before retreating to a low of 22,330, closing the day 27 points lower at 22,470. While heavy selling in IT stocks weighed on the market, gains in private banks helped limit the decline.
Among the top gainers were IndusInd Bank, which saw its stock price surge nearly 5 percent after its CEO and group chairman addressed investor concerns. Other gainers included Tata Motors, Kotak Mahindra Bank, Bajaj Finance, ITC, HDFC Bank, and Sun Pharma, which saw gains between 1 to 3 percent.
Conversely, IT stocks were the major losers, with Infosys plunging over 4 percent. Tech Mahindra, Nestle India, HCL Technologies, and TCS also ended lower, declining between 1 and 3 percent. Other notable losers included Asian Paints, Axis Bank, Hindustan Unilever, Zomato, and SBI.
The broader market also saw losses, with the BSE MidCap and SmallCap indices slipping by 0.5 percent each. Market breadth remained weak, with nearly 2,500 stocks declining compared to around 1,500 advancing stocks on the Bombay Stock Exchange (BSE).
Global Trade Concerns and the Impact on India
The market volatility also stemmed from global trade concerns, particularly following US President Donald Trump’s warning about potentially doubling tariffs on Canadian steel and aluminium. These concerns have weighed on global investor sentiment, and as a result, Indian markets have reacted in tandem, reflecting the global uncertainty.
The real estate sector saw losses of 1.7 percent, while the metal sector declined by 0.5 percent. On the other hand, private banks outperformed, with the Nifty Private Bank index gaining 0.7 percent, reflecting strength in India’s financial services sector.
The Indian rupee ended the session flat at 87.32 per dollar, compared to its previous close of 87.21. The flat currency performance reflects the cautious approach investors are taking due to the ongoing global uncertainties.
Looking Ahead
As the Holi festival approaches, investors are likely to remain cautious and keep an eye on global cues, particularly crude oil prices and institutional flows, to determine the next move in the Indian stock market. Experts suggest that market participants should wait for confirmation of price action before taking fresh positions, especially as the markets continue to face a volatile phase.
