Indian Stock Market Shows Positive Signs
The Indian stock market is gearing up for a positive opening, with benchmark indices Sensex and Nifty 50 showing strong gains after a three-day slump. On Tuesday, both indices are expected to start in the green, driven by a rebound in global markets following the recent SCO Summit in Tianjin. The Sensex closed up by 555 points, or 0.70%, at 80,364.49, while the Nifty 50 rose by 198 points, or 0.81%, to settle at 24,625.05.
Mid- and small-cap stocks outperformed the benchmarks, indicating robust investor sentiment. The BSE Midcap index climbed 1.64%, and the Smallcap index gained 1.49%. This positive momentum is further supported by India's Q1 GDP growth exceeding market expectations. Investors are also optimistic about potential GST rationalization in the upcoming council meeting, which is likely to boost market sentiment even more.
According to Rajesh Bhosale, an Equity Technical Analyst at Angel One, the Nifty's rebound signifies a recovery from oversold conditions. The broader market outlook remains encouraging, as the Nifty Midcap Index gained over 2%, indicating that bulls are defending their positions amid constructive domestic cues. With widespread buying, the expectation is that this bounce will extend in the coming days, even though challenges remain with overhead resistances.
Asian markets, influenced by the SCO leaders' discussions, have generally opened higher. The Nikkei 225 in Japan rose by 0.31%, and South Korea's Kospi increased by 0.45%. However, concerns over lingering tariff issues continue to dampen overall sentiment. The Gift Nifty was trading around the 24,759 mark, indicating a positive start for Indian markets.
On the geopolitical front, U.S. President Donald Trump criticized trade relations with India, calling them a “one-sided disaster.” He suggested that India should have acted on tariff reductions years ago. This statement highlights the complexities of international trade relations, especially in light of PM Modi's recent engagements with world leaders, including a significant discussion with Russian President Vladimir Putin.
Amid these developments, the Indian rupee has hit a record low against the U.S. dollar, nearing 88.33. Factors contributing to this decline include strong hedging by importers and rising short positions due to increased tariffs. On the commodity front, oil prices are rising amid concerns over supply disruptions stemming from the Russia-Ukraine crisis.
Overall, while the Indian stock market anticipates a positive opening, investors must remain vigilant about the prevailing economic challenges and geopolitical tensions that could influence market stability.
