Sensex Gains 100 Points at Open, Nifty Hovers Near 23,100 as IT Stocks Weigh

Indian benchmark indices opened slightly higher on Friday after suffering their biggest single-session decline in 10 weeks in the previous trading session.

However, the early recovery remained muted as elevated crude oil prices and firm US bond yields continued to weigh on investor sentiment.

The Sensex opened at 73,525.92, while the Nifty 50 started at 23,035. By 9:41 am, the Sensex was trading at 73,627.12, up 46.58 points or 0.06%, while the Nifty stood at 23,067.50, gaining 4.40 points or 0.02%.

The cautious opening came after Thursday’s sharp sell-off, with investors assessing whether the decline had stabilised or could extend into another session.

Dr V K Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, said several negative factors had combined to unsettle markets on Thursday, including rising US bond yields, higher crude prices and concerns surrounding the Insurance Regulatory and Development Authority of India’s (IRDAI) proposed changes to insurance commissions.

He noted that the US 10-year Treasury yield remaining around 5.2% was a significant headwind for global equities, while persistently high crude prices could pose a major challenge for India.

FINANCIAL STOCKS REMAIN UNDER PRESSURE

Financial stocks continued to struggle following Thursday’s heavy selling triggered by concerns over proposed changes to insurance commission structures.

At 9:41 am, Bajaj Finance and Bajaj Finserv were both down 0.56%, while Axis Bank fell 0.75% and ICICI Bank slipped 0.16%. HDFC Bank declined 0.23% and Kotak Mahindra Bank was down 0.11%.

The Nifty Financial Services 25/50 index fell 0.09%, while the Financial Services Ex-Bank index declined 0.28%.

PB Fintech remained under pressure, falling 2.53% to Rs 1,176.70 in early trade. The stock had plunged 36% in the previous session amid concerns over the proposed IRDAI changes.

IT STOCKS WEIGH, METALS AND AUTOS GAIN

IT stocks emerged as an early drag on the benchmark indices. The Nifty IT index declined 0.78%, with Infosys down 0.95%, Tech Mahindra 0.60%, TCS 0.54% and HCLTech 0.62%.

Metal stocks moved in the opposite direction, with the Nifty Metal index gaining 0.53%. Auto stocks rose 0.32%, while the pharma index advanced 0.24%.

Among Sensex constituents, M&M led the gainers with a rise of 1.04%. Asian Paints gained 0.85%, followed by Axis Bank at 0.75%, HCLTech at 0.62%, L&T at 0.59% and Power Grid at 0.56%.

The broader market remained mixed. The Nifty 100 was up 0.02%, while the Nifty 200 and Nifty 500 were nearly unchanged. The Nifty Midcap 50 fell 0.16% and the Midcap 100 declined 0.12%, while the Smallcap 100 gained 0.13%.

India VIX fell 0.68% to 12.60, indicating a modest easing in market volatility after Thursday’s sharp decline.

CRUDE PRICES EASE BUT STAY ELEVATED

Oil prices slipped on Friday but remained at elevated levels. Brent crude was trading at $105.66 a barrel, down 0.88%, while WTI crude declined 1.61% to $93.09.

The easing provided some relief after the recent surge in oil prices, but Brent remaining above $105 continued to raise concerns over India’s import bill, inflation and corporate profitability.

Investors were also keeping an eye on developments involving the US and Iran, including prospects of a truce and any progress towards reopening the Strait of Hormuz.

Vijayakumar said high crude prices and persistent inflation had increased expectations of another Federal Reserve rate hike in October, adding to the headwinds facing equities.

He said a meaningful decline in crude prices would be important for a sustained market recovery.

For Friday’s session, investors are likely to track crude oil prices, US bond yields and the performance of financial stocks closely as the market attempts to stabilise after Thursday’s steep fall.