Global markets remain bullish. The domestic stock market is starting its monthly closing week from today. As a result, Monday (October 27) started with a positive trend. Sensex was trading up by about 220 points. Nifty was also trading around 25,870, up 70 points. Bank Nifty was also trading up by about 240 points. Metal and realty stocks also witnessed a rise today. Meanwhile, slight weakness was seen in the pharma index.
On the Nifty, SBI Life, Tata Steel, Hindalco, TMPV, Bharti Airtel and Reliance were the top gainers, while ONGC, BEL, Kotak Bank, Dr Reddy’s, Bajaj Finance and Max Health were the top losers. If we look at the initial levels, the Sensex opened with an increase of 86 points at 84,297. Nifty opened 48 points higher at 25,843. Bank Nifty opened 97 points higher at 57,796. In the currency market, the rupee opened 1 paise lower at 87.86/$. The effect of the rise in global markets is also visible on Asian markets. Nikkei jumped 800 points to its highest level ever. Domestically, GIFT Nifty was trading around 25,925, up 100 points. Dow futures also gained 250 points, indicating a strong start for the Indian market today.
US market at all time high
After inflation pressure in the US remained lower than expected, expectations of an early interest rate cut by the Federal Reserve have strengthened. Amid these positive signs, a strong rise was seen in the US markets on Friday. The Dow Jones closed above 47,000 for the first time, while the Nasdaq rose nearly 250 points to an all-time high. The S&P 500 and Russell 2000 also closed at record levels. The market got relief from the latest inflation data. Both US CPI and core inflation stood at 3% in September, which is lower than expected. This strengthened market sentiment that the Fed would not delay further interest rate cuts. The softening of bond yields further boosted investor confidence in the equity markets.
start of trade agreement
Another big relief came from the US-China trade war. News that the two countries agreed to a framework for a trade deal boosted risk assets ahead of a meeting between Trump and Chinese President Xi Jinping in South Korea on Thursday. The US Treasury Secretary indicated to avoid imposing 100% additional tariffs on China, which further strengthened the market sentiment.
The effect of expectations of trade agreement is clearly visible in the commodity market also. Copper on LME has reached above $11,000 for the first time. However, gold prices remained under pressure and fell by $50 to below $4,100 in the international market. In the domestic market, gold fell by Rs 650 to close below Rs 1,23,500, while silver fell by Rs 1,000 to close below Rs 1,47,500. Crude oil prices remained almost unchanged and held steady around $66.
Flow signals were also positive. Foreign investors bought a total of ₹1,255 crore, including ₹622 crore in the cash market. Domestic funds also continued to invest for the 41st consecutive day, although the amount stood at only ₹173 crore. Signs of confidence in the Indian economy also remain strong. IMF has raised its GDP estimate for India for the current financial year to 6.6 percent. The IMF says strong growth in the first quarter largely offset the impact of US tariffs, and India remains the world’s fastest-growing major economy.
On the corporate front, Kotak Bank and Coforge reported better-than-expected results, while Dr Reddy’s and SBI Card posted mixed results. In the F&O sector, results from nine companies including IOC, Indus Tower, Sona BLW, PNB Housing, Adani Energy and Mazagon Dock could be important in deciding the market direction today.
Talking about domestic triggers, the Supreme Court will hear the Vodafone-Idea AGR case today, which will be closely watched by telecom stocks. The IPO market is also expected to see increased activity as the much-awaited IPO of Lenskart will open on October 31 and may raise around ₹7,300 crore. Meanwhile, Sebi has barred mutual funds from investing in pre-IPO placements, although anchor investments or direct IPO investments will continue to be permitted.