Sensex, Nifty Likely to Open Flat; GIFT Nifty Rises Slightly

Thursday, July 31: Indian equities are poised for a cautious start, with the Sensex and Nifty expected to open flat despite a slight rise in GIFT Nifty. This muted sentiment comes amid mixed global cues and continued volatility in the market.

GIFT Nifty Indicates Muted Start Despite Overnight Volatility

The GIFT Nifty rose slightly, gaining 24 points or 0.10% to 24,679.00 as of 8:45 AM. The index opened at 24,711.00, with an intraday low of 24,650.00 and a high of 24,719.00. The flat trajectory suggests a cautious start for Indian equities despite mixed global cues.

Previous Close Recap: Markets Ended Marginally Higher

On 30th July, domestic markets ended in positive territory amidst monthly F&O expiry volatility. The Sensex closed at 81,481.86, showing an increase of 143.91 points or 0.18%. Similarly, the Nifty 50 settled at 24,855.05, rising by 33.95 points or 0.14%. Gains were primarily supported by buying activity in the IT, FMCG, and capital goods sectors, while auto, PSU banks, and realty segments experienced some profit booking.

FIIs Sell for 8th Day, DIIs Continue Accumulating

Foreign Institutional Investors (FIIs) net sold equities worth ₹850 crore on 30th July, marking their eighth consecutive day of selling. In contrast, Domestic Institutional Investors (DIIs) maintained their strong buying streak for the 18th day, investing ₹1,829 crore.

Global Market Overview

Wall Street:

US markets concluded Wednesday’s trading session with mixed results. The Dow Jones Industrial Average saw a decline of 171.71 points, or 0.38%. The S&P 500 also closed lower by 7.96 points, a decrease of 0.12%. In contrast, the Nasdaq Composite edged higher, gaining 31.38 points, or 0.15%. Federal Reserve Chair Jerome Powell’s indication of no immediate interest rate cuts weighed on market sentiment.

Bond Market & Dollar:

In the bond market, the 10-Year Yield stood at 4.39%, while the 2-Year Yield was recorded at 3.93%. The Dollar Index strengthened, reflecting the Federal Reserve’s hawkish tone.

Commodities:

Crude oil prices extended their gains, driven by persistent supply concerns and geopolitical tensions. Gold, after earlier declines, rebounded modestly.

Asian Markets:

Asian equities traded with mixed results as investors reacted to the US’s 15% blanket tariffs imposed on Korean imports. Additionally, market participants awaited cues from the Bank of Japan’s upcoming policy stance announcement.

Insights For Investors

• Cautious Opening Expected: Despite a slight uptick in GIFT Nifty, the flat start in Sensex and Nifty suggests investors should brace for range-bound movement in early trade.
• FIIs Remain Net Sellers: Continued FII outflows for eight straight sessions indicate persistent foreign selling pressure, which could impact broader market sentiment.
• Strong DII Support: DIIs continue to provide support to domestic markets with sustained buying, signalling confidence in India’s fundamentals amid global uncertainty.
• Sectoral Rotation in Play: Gains in IT, FMCG, and capital goods alongside profit booking in auto and PSU banks highlight active sector rotation; selective stock-picking is advisable.
• Global Headwinds: Mixed US market performance, hawkish Fed stance, and Asian market jitters due to US tariffs and BOJ policy uncertainty suggest investors should stay alert to global developments.
• Focus on Risk Management: With volatility and global cues dictating short-term moves, risk-managed positions and a diversified portfolio approach remain crucial.

What’s Ahead For Today?

• Muted Market Open Expected: Indian equities are likely to start on a flat note, with GIFT Nifty pointing to subdued sentiment amid global uncertainties and overnight volatility.
• Stock-Specific Action Possible: Earnings from key companies and sector-specific news may drive movement in select stocks. L&T’s strong results may continue to support capital goods, while IT and FMCG could see follow-through buying.
• Macro Factors in Focus: Investors will keep an eye on foreign fund flows, oil prices, and global bond yields, especially after the Fed’s indication of no immediate rate cuts.
• Derivatives Expiry Hangover: After the monthly F&O expiry, traders may reassess positions, potentially leading to lower volumes and range-bound movement.
• Watch Global Cues: Developments in US-India trade talks, Asian central bank decisions, and commodity movements, particularly oil and gold, will influence broader sentiment.
• Technical Levels to Track: For Nifty, support lies near 24,700–24,750, while resistance is expected around 24,950–25,000. Sensex may face resistance near 81,600 and support near 81,200.

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