GIFT Nifty Indicates Steady Start for Indian Markets

At 7:22 AM, GIFT Nifty was trading at 24,955, down 42.50 points or 0.17%, with the index oscillating between its low of 24,955 and a high of 24,999.50. The index is just below the 25,000 mark, indicating a calm opening for Indian equities even as the early trade saw a fall.

U.S. markets closed last Friday on a strong note following Federal Reserve Chairman Jerome Powell’s indication of a potential rate cut in September in his address at the Jackson Hole Symposium.

Thereafter, the Dow Jones Industrial Average rose 1.89% to close at 45,631.74, its highest-ever closing level. The S&P 500 rose 1.52% to close at 6,466.91, and the Nasdaq Composite rose 1.88% to close the day at 21,496.54, with investors going ga-ga over Powell’s dovish tone.

Asian stocks opened higher today, following the surge on Wall Street, as risk appetite firmed on expectations of looser U.S. monetary policy. In the bond market, the 10-year U.S. Treasury yield remained at 4.26%, while the 2-year yield decreased to 3.7%, showing increasing expectations of policy relaxation. The dollar index tried to bounce back after plummeting sharply last week, though the tone is still cautious.

Asian currency movement was varied, with the Philippines Peso, Taiwan Dollar, Chinese Renminbi, and Malaysian Ringgit strengthened. At the same time, the Indonesian Rupiah, South Korean Won, Japanese Yen, and Thai Baht fell against the U.S. dollar.

In commodities, crude oil prices steadied after advancing last week, with supply issues providing support. Gold prices remained firm, supported by increasing expectations of a U.S. interest rate cut as soon as September.

Indian shares snapped their six-session winning streak on August 22, weighed down by weakness in major sectors. The Sensex dropped 693.86 points, or 0.85%, to settle at 81,306.85, and the Nifty 50 fell 213.65 points, or 0.85%, to close at 24,870.10.

Sectorally, media and pharma stocks were able to register gains, whereas metal, IT, FMCG, banking, and realty counters saw selling pressure. Foreign institutional investors were net sellers, withdrawing ₹1,622 crore from Indian equities, with domestic institutional investors also reducing exposure with ₹329 crore of sales.

In the near term, GIFT Nifty positioning near the 25,000 level indicates a firm beginning for Indian markets today. Overall global conditions remain supportive, with Wall Street’s firm close and Powell’s remarks providing a positive tone to equities.

Market observers expect sector rotation to persist, with pharma and media expected to be in focus, while IT and banking counters could continue to experience pressure in the near term.

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