Indian equity markets open flat; financial shares drag
2 min read
Indian equity benchmarks opened largely unchanged on Thursday, with the Nifty holding near the 22,600 level as gains in IT and pharmaceutical stocks were countered by weakness in financial, FMCG, and auto shares.
The Nifty opened at 22,599.05, down 4 points or 0.02%, while the Sensex began at 72,668, up 29.30 points or 0.04%.
Among sectors, Nifty IT, Nifty MidSmall Healthcare, and Nifty Pharma led gains, advancing up to 0.59%.
Metal, consumer durables, and chemical stocks also traded marginally higher.
Conversely, Nifty Financial Services ex-Bank and Nifty FMCG declined up to 0.38%.
Market experts noted that the RBI’s calibrated tightening stance could weigh on equity valuations, as higher interest rates make fixed-income investments relatively more attractive.
They anticipate investor preference shifting marginally toward interest-inelastic sectors such as pharmaceuticals.
Experts also observed that growth stocks continue to draw investor interest despite elevated valuations, while value stocks have remained subdued.
“Sustained selling by foreign investors in large-cap stocks, combined with the US 10-year Treasury yield holding above 5.3%, could keep large-caps under pressure,” they said.
According to market experts, the Nifty’s repeated tests of the 22,574 level on Wednesday suggest an extended consolidation phase before a clear direction emerges.
“Though considerably weakened, the 23,100–22,000 range remains in play, with a downside marker at 22,439,” they added.
Experts added that a sustained trend reversal would require foreign investors to turn net buyers. They also said value stocks could present opportunities over the longer term.
Foreign institutional investors remained net sellers on Wednesday, offloading equities worth more than Rs 6,121 crore.
Domestic institutional investors, however, provided support, purchasing equities worth around Rs 4,596 crore.
Market sentiment stayed cautious amid concerns over elevated US Treasury yields and oil prices. Asian markets also traded cautiously following a softer session on Wall Street.
