Benchmark indices opened higher on Friday, helped by a decline in crude oil prices and bargain buying after the recent sell-off. However, gains remained limited as Middle East tensions continued and strong demand for domestic IPOs kept liquidity concerns in focus.
The BSE opened at 74,575.24 and was trading at 74,430.03 at 9:27 am, up 115.44 points or 0.16% from the previous close. The Nifty 50 opened at 23,334.70 and was at 23,294.45, up 23.85 points or 0.10%.
The opening comes after the Nifty gained for two consecutive sessions following a sharp correction over the previous five weeks.
Tata group stocks were under pressure at the start of Friday’s session, reversing some of the gains seen in the previous session after Tata Sons reappointed N Chandrasekaran as executive chairman and said it would consider a public listing.
TCS was the biggest Sensex laggard, falling 3.12%. Tata Steel declined 1.12%. Other technology stocks were also under pressure, with Infosys down 0.82%, HCLTech falling 1.11% and Tech Mahindra declining 1.22%.
At the same time, some Tata-linked counters traded higher. Trent gained 0.29%, while Tata Motors was not among the stocks shown in the Sensex snapshot at the time of the latest update.
The Tata group remains in focus after Tata Sons approved a fresh five-year term for Chandrasekaran as executive chairman. Shareholder Shapoorji Pallonji Group has also proposed selling part of its stake.
Oil prices provided some relief to the domestic market. Brent crude was trading at $103.79 a barrel, down 0.98%, while WTI crude was at $101.01, down 0.88%.
Brent prices eased as hopes that alternative routes could keep Middle Eastern oil flowing to global markets outweighed concerns over renewed strikes involving Saudi Arabia and Yemen’s Houthi forces.
However, the oil market remains sensitive to developments around the Middle East, particularly given continuing concerns around supply disruptions.
The primary market remains another key factor for Indian equities. Five IPOs are currently open for subscription, including the National Stock Exchange’s issue.
The NSE IPO was subscribed 0.43 times on the first day of bidding, according to the information provided.
The heavy IPO activity comes after the domestic market has already seen a sharp correction, with investors increasingly directing money towards new issues and listing gains.
Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said the strength of the US market despite elevated bond yields is helping support global equities.
“Under normal circumstances rising bond yields pull the market down. But now, despite the 10-year yield breaching the psychological 5% mark, the market exhibited surprising resilience,” Vijayakumar said.
He said strong US corporate earnings and a robust economy were helping offset the impact of high bond yields.
The broader market was stronger than the benchmark indices at the open. Nifty 100 gained 0.26%, Nifty 200 rose 0.32% and Nifty 500 advanced 0.39%.
Mid- and small-cap stocks also outperformed. Nifty Midcap 50 gained 0.47%, Nifty Midcap 100 rose 0.56% and Nifty Smallcap 100 climbed 0.87%.
India VIX fell 0.93% to 12.18, indicating some moderation in market volatility.
Fifteen of the 16 major sectoral indices gained at the open.
Nifty Realty was among the strongest performers, rising 1.39%, while Nifty Pharma gained 0.76%. Nifty MidSmall Healthcare rose 0.80%, Nifty Healthcare advanced 0.72% and Nifty Chemicals gained 0.68%.
Nifty Financial Services Ex-Bank rose 0.61%, Nifty MidSmall Financial Services gained 0.64%, Nifty Metal advanced 0.53% and Nifty Oil & Gas rose 0.42%.
Nifty Auto gained 0.25%, Nifty Private Bank rose 0.30% and Nifty PSU Bank advanced 0.14%.
Nifty IT was the clear exception, falling 1.48%, dragged by heavy selling in TCS, HCLTech and Infosys.
The market is attempting to recover from its recent correction, but the rebound is facing several headwinds. Crude oil prices, Middle East tensions, the IPO pipeline and global bond yields remain key factors for investors.
Vijayakumar said the IPO boom has created an unusual situation where the focus on new issues has opened opportunities in the secondary market.
“The ongoing boom in the Indian primary market has paradoxically opened up opportunities for investors in the secondary market. The focus of investors now is the IPO market and the listing gains from IPOs. Consequently the secondary market is languishing with prices of large-caps getting depressed,” he said.
“For long-term investors, this is an opportunity. Leading banks, capital goods majors, select automobiles and pharmaceutical stocks provide buying opportunities,” Vijayakumar added.
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