Mumbai, Aug 11: Indian equity markets opened largely flat on Tuesday as gains in information technology and consumer durables stocks were offset by weakness in banking and financial counters, while rising crude oil prices remained a key concern for investors.
The Sensex opened 32.67 points, or 0.04 per cent, lower at 78,509.77, while the Nifty started the session 8.70 points, or 0.04 per cent, down at 24,575.10.
Sectoral performance was mixed in early trade. The Nifty MidSmall IT & Telecom index rose 0.73 per cent, while the Nifty Consumer Durables and Nifty IT indices gained 0.66 per cent and 0.63 per cent, respectively. Real estate, automobile and pharmaceutical stocks also traded with gains.
Banking stocks, however, remained under pressure. The Nifty Private Bank index declined 0.64 per cent, while the Nifty PSU Bank index fell 0.62 per cent.
Market analysts said higher Brent crude prices continued to act as an irritant for domestic equities, although improving domestic fundamentals, better-than-expected June-quarter earnings and stability in the rupee were helping support investor sentiment.
Analysts said renewed buying by foreign institutional investors, encouraged by stronger-than-expected first-quarter earnings and relative stability in the rupee, could help keep the domestic market resilient with a modest positive bias.
Robust domestic consumption is expected to support earnings growth through FY27. Analysts also pointed to large FCNR (B) inflows as a potential source of support for the rupee, which could in turn facilitate further foreign investor participation in Indian equities.
Foreign investors are also reallocating capital from the so-called “chip trade” in South Korea and Taiwan, while seeking to increase their exposure to Indian equities. However, the fresh inflows are reportedly being channelled into relatively expensive sectors such as telecom, renewable energy, capital goods and pharmaceuticals, rather than banking majors, which remain comparatively attractively valued.
From a technical perspective, analysts have identified the 24,400-24,450 range as an immediate support zone for the Nifty, while 24,750-24,800 is seen as a key resistance area. Sustaining above the support zone could keep the index’s sideways-to-positive bias intact, with buying interest likely to emerge on declines. A decisive break above 24,750-24,800 could further strengthen momentum and provide a fresh directional trigger.
Crude oil prices remained elevated, with Brent crude, the international benchmark, rising 0.41 per cent to $88.08 a barrel. US West Texas Intermediate crude gained 0.47 per cent to $82.52 a barrel.
Asian markets traded mixed in early deals. Japan’s Nikkei rose around 2 per cent and South Korea’s KOSPI gained more than 1 per cent, while Hong Kong’s Hang Seng declined 0.6 per cent.
US equities ended marginally lower on Monday, with the S&P 500 slipping 0.06 per cent and the Nasdaq declining 0.32 per cent.
