Benchmark stock market indices opened higher on Monday, on hopes of US rate cuts this week.
The S&P BSE Sensex added 169.53 points to 83,060.47, while the NSE Nifty50 gained 62.55 points to 25,419.05 as of 10:25 AM. Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said that globally equity markets will be focused on the Fed rate action on Wednesday which is likely to influence the stock market trend in the near-term.
“The first rate cut by the Fed in four years is a foregone conclusion, the only uncertainty is about the extent of the rate cut, that is, whether the cut will be 25 bp or 50 bp. The market will also be keenly watching the Fed commentary on the evolving economic outlook,” he added.
Leading the gainers on Nifty50 index was NTPC with an increase of 1.41%. Adani Enterprises also performed strongly, rising 1.38%. Kotak Mahindra Bank showed growth, climbing 1.32%. Mahindra & Mahindra (M&M) and Shriram Finance rounded out the top gainers, advancing 1.20% and 1.05% respectively.
On the downside, Bajaj Finance experienced the largest decline, dropping sharply by 2.60%. Hindustan Unilever also faced significant losses, falling 2.15%. Bajaj Finserv declined by 1.95%, while Britannia Industries and SBI Life Insurance completed the list of top losers, dipping 0.84% and 0.54% respectively.
“Nifty which has rallied 16.7% YTD is one of the best performing stock indices in the world. Even though India’s economic fundamentals and corporate earnings are strong, the single most important factor driving the Indian market now is the sustained domestic liquidity flows into the market. The resilience of the Indian market despite elevated valuations has forced FIIs to turn buyers in the cash market, where they bought on all days last week,” said Vijayakumar.
The IPO of Bajaj Housing Finance made a bumper debut at Dalal Street listing at a premium of 114% after having received bids worth over Rs 3.2 lakh crore.
Early trading session saw modest gains in the broader market indices, alongside a slight increase in volatility. The Nifty Midcap100 index rose by 0.29%, indicating some positive sentiment towards medium-sized companies. The Nifty Smallcap100 index showed minimal movement, inching up by just 0.01%. Meanwhile, the India VIX, often called the market’s fear gauge, increased by 1.19%.
Since the undertone of the market continues to be bullish, it makes sense to remain invested. Among sectors, IT and pharma are showing strength.
The indices that gained ground include Nifty Media rising 0.79%, Nifty Metal (0.68%), Nifty PSU Bank (0.37%), Nifty Bank (0.38%), Nifty Auto (0.22%), and Nifty Financial Services (0.10%). Nifty Realty led the gainers with a 1.18% increase, while Nifty Private Bank and Nifty Consumer Durables also saw notable gains of 0.44% and 0.77% respectively.
On the downside, Nifty FMCG experienced the largest decline, dropping 0.40%. Other indices in the red include Nifty Financial Services 25/50 (-0.11%) and Nifty IT (-0.09%). The healthcare sector showed positive movement, with both Nifty Healthcare Index and Nifty Midsmall Healthcare advancing by 0.37% and 0.24% respectively. Nifty Pharma also edged up slightly by 0.13%.