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Domestic equity benchmarks opened on a cautious note on Friday as the market participants weighed global economic signals against domestic technical resistance levels. BSE Sensex traded at 82,202.63 at 9:18 am, marking a decline of 104.74 points or 0.13 per cent. Simultaneously, NSE Nifty 50 stood at 25,255.40, down by 34.50 points or 0.14 per cent.
The initial volatility reflects a measured approach by investors despite a bounce in international indices. Highlighting the global backdrop, Banking and Market Expert Ajay Bagga said, "Following the US lead, Asian markets are up, relieved at the pause by the BOJ ahead of the Japanese snap elections on Feb 8th." He further noted that the Bank of Japan raised economic growth forecasts while holding rates at 0.75 per cent. Bagga also observed a resurgence in the so-called "TACO trade" narrative, where investors anticipate tariff reversals following recent US policy pauses, alongside a record-setting rally in precious metals where gold topped USD 4,900 per ounce. "Strength to Indian markets will come from global risk on, rather than any domestic catalysts for now. Markets are pointing to a quiet start but given the FPI selling in January, expect volatility ahead as Monday is a market holiday on the occassion of the Republic Day. Positions will be cut as now we will hit the monthly expiry on Tuesday directly without the benefit of a Monday trading day," Bagga said. Domestic sentiment remains supported by institutional flows even as foreign investors maintain a watchful stance. Ponmudi R, CEO of Enrich Money, said, "Indian equity markets are likely to trade on a cautious to mildly bullish note today, with the rebound from the previous session expected to extend at a measured pace, tracking overnight gains in U.S. equities and a mildly positive tone across Asian markets in early trade." He added that while short-term sentiment improved, risk appetite stayed selective due to lingering uncertainty around U.S. policy actions and potential tariff measures linked to countries importing Russian oil. Nifty remains in a narrow consolidation range with a mild positive bias, holding firmly above its key support zone, Ponmudi R noted. He said that immediate support is placed at 25,120-25,160, while a decisive break below 25,000 could expose the index to lower levels. He stated, "Overall bias stays mildly bullish, with scope for a gradual move toward 25,600 as long as Nifty sustains above 25,300 and holds its 200-DMA support." In the banking sector, the Bank Nifty reclaimed its 50-day EMA, shifting to a neutral-to-bullish structure. Ponmudi R observed that the resistance band at 59,600-59,700 remains the key hurdle for a further breakout toward the 60,000 mark. "The rupee has stabilized near 91.50-91.60 after testing record lows around 91.72, supported by risk-on sentiment and possible RBI intervention. This stabilization offers temporary relief on imported inflation concerns, though currency sensitivity to capital flows remains high. India VIX has moderated marginally, indicating easing near-term volatility," Ponmudi said. (ANI)
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