Pre-Open Points To Uptick At Start As Investors Rotate Out Of Asia Selloff 

Mumbai, November 6: Indian shares ticked up at pre open signalling a higher start as investors looked to rotate out of the selloff underway in Asia after Wall Street weakness following AI regulation concerns after Democratic victory in the US. 

Nifty 50 rose 0.2% and Sensex advanced 0.14% at pre open.  

The Nifty 50 and BSE Sensex have advanced for six consecutive sessions, culminating in their strongest single-day rally in seven months on Thursday, supported by falling crude oil prices and a sharp resurgence in foreign investor buying.  

Foreign institutional investors (FIIs) pumped nearly Rs 15,000 crore into Indian equities in Thursday’s session, marking their biggest single-day net purchase in almost six years. The buying came as global investors rotated out of AI-linked stocks amid growing concerns over technology valuations and investment sustainability.  

Nifty and Sensex rallied 2.4 percent and 2.6 percent, respectively, on Thursday after Brent crude slipped below the $100-per-barrel mark. Expectations that the Democrats’ sweeping victory in the US midterm elections could accelerate efforts to end the US-Iran conflict further improved risk appetite.  

Telecom major Bharti Airtel‘s September-quarter earnings fell short of market expectations as rising network operating expenses ate into the benefits of a growing subscriber base and customers migrating to higher-priced plans.  

Titan, a jewellery and lifestyle retailer, delivered a better-than-expected performance in the September quarter, with profitability supported by a one-off gain and demand for premium diamond-studded jewellery.  

Life Insurance Corporation of India (LIC), the country’s largest insurer, recorded an improvement in September-quarter earnings, driven by an expansion in its group insurance business.  

Oil and Natural Gas Corporation (ONGC), a state-run oil producer, reported stronger second-quarter profitability, benefiting from higher crude oil prices during the quarter, which helped lift its margins.  

Britannia Industries, a packaged foods manufacturer, surpassed September-quarter profit estimates, supported by steady demand for its biscuits and other consumer food products. 

Asian Markets Today 

The selloff was particularly pronounced across Asian technology-heavy markets, with semiconductor stocks bearing the brunt of the correction. South Korea’s Kospi plunged more than 8 percent during the session, triggering a circuit breaker, before recovering some losses to trade 4.14 percent lower. Japan’s Nikkei 225 dropped 5.3 percent, while Taiwan’s Taiex plunged more than 8 percent intraday and was last trading 3.2 percent lower. 

Among individual stocks, Samsung Electronics fell nearly 10 percent, SK Hynix declined 11.7 percent and Taiwan Semiconductor Manufacturing Company (TSMC) shed 8.5 percent. SoftBank also slumped 11 percent. 

Wall Street Ends Deep In Red 

The weakness followed a bruising session on Wall Street on Thursday, with technology stocks leading the decline. The Nasdaq Composite plunged 5.52 percent, registering its biggest single-day decline in 19 months and entering correction territory. The S&P 500 fell 4.36 percent, while the Dow Jones Industrial Average shed 3.44 percent. 

The Philadelphia Semiconductor Index tumbled more than 12 percent, while the selloff wiped out approximately $3 trillion in market value from S&P 500 companies. 

Concerns over the sustainability of massive AI investments, stretched valuations and the prospect of greater regulatory scrutiny following the Democrats’ sweeping victory in the US midterm elections weighed on sentiment. Nvidia plunged more than 9 percent, while Qualcomm also came under pressure following weaker-than-expected smartphone chip sales. 

US stock futures were relatively steady on Friday after the steep overnight losses, suggesting investors were assessing the extent of the correction. 

Crude Oil Prices Rebound 

Crude oil prices recovered some ground on Friday after falling sharply earlier in the week amid hopes that the Democrats’ victory could increase pressure on the Trump administration to pursue a diplomatic resolution to the Iran war. 

Brent crude futures rebounded towards $99 per barrel after slipping below the $100 mark for the first time in two months. US West Texas Intermediate (WTI) crude traded around $91 per barrel. Despite the recovery, both benchmarks remained significantly below their levels earlier in the week. 

The correction in oil prices has offered some relief to global markets by easing concerns over energy-driven inflation. For India, a major crude importer, lower oil prices could help contain inflationary pressures, support the rupee and improve corporate margins. 

Source

• Exchanges