Sensex, Nifty open higher, eye record highs as global sentiment improves

Indian stock markets opened higher on Monday, supported by strong global cues and renewed investor optimism following the U.S. Federal Reserve’s recent interest rate cut.

The Sensex opened at 84,651.15, above its previous close of 84,544.31, indicating a bullish sentiment. Similarly, the Nifty50 saw a gap-up opening at 25,872.55, surpassing its previous close of 25,790.95.

“The market is anticipated to open strongly, driven by a notable rally in Asian markets, half percent rise in US index futures, and ongoing foreign institutional investor (FII) buying,” said Vikas Jain, Head of Research at Reliance Securities.

• Also read: Index Outlook: Nifty 50, Sensex: Rally gathers pace

Foreign institutional investors (FIIs) were net buyers of over ₹14,000 crore on Friday, marking the highest single-day purchase in three years. This significant inflow was boosted by FTSE rebalancing, resulting in $3 billion in net purchases for the month.

Deepak Jasani, Head of Retail Research at HDFC Securities, commented, “The Dow Jones Industrial Average closed modestly higher Friday to mark a fresh record high, as major U.S. stock benchmarks booked weekly gains in the wake of the Federal Reserve’s large interest-rate cut on Wednesday.”

In the domestic market, top gainers on the NSE at 9:30 am included M&M (2.10 per cent), Bharti Airtel (1.89 per cent), Shriram Finance (1.85 per cent), Divi’s Lab (1.59 per cent), and Bajaj Auto (1.41 per cent). Conversely, top losers were ICICI Bank (-1 per cent), Hindalco (-0.76 per cent), HCL Tech (-0.37 per cent), LTIMindtree (-0.28 per cent), and JSW Steel (-0.25 per cent).

Sectors expected to be in focus include banking, NBFCs, gold finance, realty, and telecom stocks. The approval for HDFC Bank’s subsidiary HDB Financial’s IPO is likely to boost sentiment in the banking sector.

Ameya Ranadive, Sr Technical Analyst at StoxBox, noted, “Throughout the trading week, the benchmark index exhibited limited activity and remained within narrow ranges, signaling reduced volatility. However, on Friday, there was a surge in buying activity by FIIs, propelling the Nifty50 to reach record highs of 25,849.”

On the global front, Asian markets started the week mostly higher, with investors closely watching central bank meetings and key U.S. economic data. The People’s Bank of China surprised markets by lowering its 14-day repo rate by 10 basis points.

Oil prices rose slightly in early trading on Monday, driven by worries about potential supply disruptions due to conflicts in the Middle East.

Gold prices hit a fresh all-time high, with spot gold jumping as much as 1.5 per cent to $2,625 an ounce on Friday, supported by dollar weakness following the Fed’s rate cut.

As the market opens, all eyes will be on whether the Nifty can sustain above the 25,800 mark, which could potentially lead to further rallies towards 26,000 and 26,400 levels in the coming week.