Benchmark indices opened marginally higher on Friday after snapping a run of losses in the previous session, but gains remained limited as elevated crude oil prices and pressure in global bond markets kept investors cautious.
The BSE Sensex was up 62.09 points, or 0.08%, at 77,599.81, while the Nifty 50 rose 16.05 points, or 0.07%, to 24,247.90 as of 10 am. The Sensex had closed at 77,537.72 in the previous session, while the Nifty ended at 24,231.85.
The Nifty had broken a seven-session losing streak in the previous session, while the Sensex also snapped its recent run of losses.
CRUDE OIL, BOND YIELDS REMAIN KEY CONCERNS
Brent crude was trading at $93.52 a barrel, down 0.28%, while WTI crude stood at $86.44, down 0.45%. Despite the mild decline in early trade, crude remained elevated, keeping pressure on investor sentiment.
Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said the recent market rally may struggle to sustain as Brent crude approaches $94 a barrel and US bond yields rise again.
“Yesterday’s rally in the market is unlikely to sustain, given the latest headwinds from Brent crude approaching $94 and U.S. bond yields again climbing up,” Vijayakumar said.
He added that the Nifty could come under pressure from profit booking in some large-cap stocks, with weakness in large-caps likely to continue and constrain a sustained market rally.
Among Sensex stocks, Kotak Mahindra Bank was the top gainer, rising 1.52%. BEL gained 1.08%, while Tata Steel, SBI, HDFC Bank and ICICI Bank advanced 0.60%, 0.53%, 0.51% and 0.46%, respectively.
Tech Mahindra rose 0.39%, while Axis Bank and Power Grid gained 0.37% and 0.32%. Bajaj Finance and Bajaj Finserv were also in positive territory.
On the other hand, IndiGo was the biggest Sensex loser, falling 1.17%. Titan declined 0.77%, while Hindustan Unilever lost 0.71%. Reliance Industries, Maruti and ITC were also trading lower.
METAL, PRIVATE BANK, REALTY STOCKS GAIN
Sectoral trends were mixed in early trade. Nifty Metal was the top sectoral gainer, rising 0.80%, followed by Nifty Private Bank, which gained 0.69%. Nifty Realty advanced 0.68%, while Nifty Financial Services 25/50 and Nifty PSU Bank rose 0.30% and 0.23%, respectively.
Nifty Oil & Gas was up 0.04%.
Nifty IT was among the major laggards, falling 0.64%. Nifty FMCG declined 0.61%, while Nifty Auto and Nifty Healthcare fell 0.34% and 0.33%, respectively. Nifty Pharma slipped 0.21%.
Vijayakumar said the broader market momentum was likely to remain stronger, backed by buying from domestic institutional investors (DIIs) and foreign institutional investors (FIIs), along with improving fundamentals.
“Even though large-cap banking stocks are under pressure, NBFCs are on strong wicket backed by strong fundamentals and technicals,” he said.
SMALL-CAPS OUTPERFORM BROADER MARKET
In the broader market, Nifty Smallcap 100 was the strongest performer, rising 0.77%. Nifty 500 was up 0.03%, while Nifty 100 was flat.
However, Nifty Midcap 50 fell 0.26% and Nifty Midcap 100 declined 0.16%. India VIX, the market’s volatility gauge, rose 4.69% to 11.26.
Vijayakumar said the digital platform space was showing strength, while pharma and contract development and manufacturing organisation (CDMO) stocks continued to attract buyers despite elevated valuations.
He said the market was likely to remain rangebound as long as crude oil prices stayed elevated.
