Indian equity markets opened lower on Monday as China’s smaller-than-expected stimulus package and persistent foreign investor selling weighed on sentiment, despite record highs in US markets following Donald Trump’s presidential victory.
The benchmark Sensex opened at 79,298.46, down from its previous close of 79,486.32, while the Nifty started at 24,087.25, lower than Friday’s close of 24,148.20.
Asian Paints led the decline, tumbling 8.43 per cent following weak quarterly results. Other major losers included BPCL (-1.24 per cent), Hindalco (-1.08 per cent), ONGC (-1.05 per cent), and Cipla (-1.04 per cent). However, Tata Motors showed strength, rising 2.27 per cent, followed by Power Grid (2.13 per cent), Maruti (1.30 per cent), Trent (0.94 per cent), and Britannia (0.93 per cent).
“The sustained rally in the US markets which have taken the Dow and S&P 500 above 40,000 and 6,000 respectively is no longer a tailwind for Indian markets,” said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. “Expectations that tax cuts promised by Trump and his pro-business policies will boost corporate earnings in the US are driving the rally.”
Foreign institutional investors (FIIs) continued their selling spree, offloading equities worth Rs 3,404 crore on November 8, while domestic institutional investors (DIIs) partially offset this by purchasing equities worth Rs 1,748 crore.
China’s announcement of a five-year package totaling 10 trillion yuan ($1.4 trillion) to tackle local government debt problems fell short of market expectations. The package includes 800 billion yuan in local government special bonds annually over five years.
“The markets have been navigating a cautious path over the past week, reflecting a lingering sense of uncertainty,” noted Ameya Ranadive, Senior Technical Analyst at StoxBox. “Technically, the Nifty has not fully escaped the challenges it faces; A cluster of resistance levels lies ahead, with the 100 DMA at 24709 and a short-term 20-day MA at 24486.”
The IT sector emerged as the top gainer last week, rising 3.78 per cent, while the Realty index declined over 4 per cent. The technology sector’s strength was attributed to expectations of increased US tech spending under Trump’s presidency.
“The outlook remains positive for tech stocks, especially with the prospect of higher US tech spending under a potential Donald Trump presidency,” said Vikas Jain, Head of Research at Reliance Securities. “Defense stocks are also in focus, driven by expectations of increased US defense spending, new defense deals, and ongoing geopolitical tensions.”
In the commodities market, gold fell below $2,700 per ounce as investors assessed the implications of Trump’s victory and the path ahead for US rates. Brent crude oil declined 2 per cent to below $74 per barrel.
The market will be closely watching this week’s inflation data releases from the US, India, and Europe, along with commentary from US Federal Reserve officials regarding potential rate cuts. Major companies scheduled to announce results today include Britannia, ONGC, Hindalco, NMDC, Bank of India, UPL, Jubilant Foodworks, Ramco Cements, and BEML.
