Benchmark stock market indices started the day lower on Thursday following the anticipated rate cut by the US Federal Reserve. Investor confidence remained cautious before the scheduled meeting between US President Donald Trump and Chinese President Xi Jinping, with markets keenly observing progress on a potential trade agreement.
At 9:23 am, the S&P BSE Sensex dropped by 251.52 points to 84,745.61, while the NSE Nifty50 declined by 81.55 points to 25,972.35. The broader markets also experienced a downturn due to a mix of caution and profit-taking.
Notable gainers on the Sensex included L&T, Tata Motors Passenger Vehicles (TMPV), Eternal, and UltraTech Cement, while Sun Pharma, Bharti Airtel, and ITC showed weakness.
Foreign investor activity influenced the subdued market opening, with FIIs turning net sellers in the previous session. Comments from Fed Chair Jerome Powell tempered expectations of a further rate cut in December, according to Prashanth Tapse, Senior VP (Research) at Mehta Ltd. Despite this, Tapse mentioned that the Nifty holding above 26,000 indicates underlying domestic strength in anticipation of key earnings reports from companies like ITC, Cipla, Maruti, and Pidilite.
Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted the market’s focus shifting to the Trump-Xi meeting. He emphasized that a breakthrough in the discussions could signify the resolution of the trade war and uplift global sentiment.
Regarding domestic factors, he cited the Chief Economic Adviser’s positive outlook on GDP growth potentially reaching 7%, driven by robust consumption and signs of increased capex, as evidenced by L&T’s recent order wins. He mentioned that the market structure suggests a likelihood of a modest rally and potential new highs, rather than a rapid surge.
Analysts noted that technically, the Nifty’s bias remains sideways to bullish as long as it holds above the 25,900–26,000 support range, with resistance levels at 26,100–26,200. A breakout could propel the index towards 26,300–26,400.
For the Bank Nifty, support levels are at 58,100–58,200 and resistance at 58,600–58,700, with a breakthrough above the latter potentially leading to a rise towards 59,000.
On the investment front, Foreign Institutional Investors sold equities amounting to Rs 2,540.2 crore on October 30, while Domestic Institutional Investors purchased Rs 5,692.8 crore, indicating substantial local buying support.