A softer GIFT Nifty points to a cautious open as investors weigh profit-taking against support from lower oil prices, renewed foreign buying and hopes of tax changes.
Indian equities are set for a cautious open on Wednesday after a powerful four-session advance, as traders weigh whether the rebound has room to run or is due for a pause. GIFT Nifty was last seen at 23,705, down 55 points, signalling a soft start for the Nifty and Sensex after the recent surge. According to market watchers, the immediate risk is that investors use strength to lock in gains rather than chase prices higher.
That caution follows a strong finish on Tuesday, when the Nifty rose 370.05 points, or 1.58 per cent, to 23,810.85 and the Sensex climbed 1,225.07 points, or 1.62 per cent, to 76,917.85. India Infoline said the rally was supported by buying in consumer goods, real estate and private banks, while softer crude prices and hopes of a change to long-term capital gains tax rules also helped sentiment. Weakness in public-sector banks, metals and energy shares showed that the advance was not broad-based across every part of the market.
Crude oil remains one of the most important swing factors for Indian assets. The Business Times reported that Brent slipped to US$103.60 a barrel and West Texas Intermediate closed at US$96.09 on Tuesday, both near four-week lows, as traders assessed the chances of peace talks against continued disruption risks linked to the wars in Ukraine and Iran. Lower oil prices tend to ease pressure on India’s import bill, inflation and corporate margins, which is one reason investors have recently been more willing to buy domestic equities.
Foreign inflows are another key support, after months of persistent selling by overseas investors. Live market data from NDTV Profit showed net foreign purchases of ₹6,836.81 crore on 3 November, suggesting renewed interest in Indian shares. Ponmudi R of Enrich Money said the market may still consolidate after the recent rebound, but he argued that easing crude, improving foreign participation and optimism around tax policy could help cushion any pullback. He added that the coming sessions will show whether buying extends beyond a handful of large stocks into the broader market.
Outside India, the global backdrop is mixed. Reuters reported that more than US$1.48 billion had been wagered on the US midterm elections in prediction markets, underscoring the scale of investor attention on American politics. In Asia, South Korean shares fell in morning trade and US futures weakened as election uncertainty and volatility in technology stocks fed into sentiment, according to reports from Aju Press and Reuters. That softer tone in global markets may limit enthusiasm in Mumbai even as domestic fundamentals have improved.
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