Indian shares look set for a soft start on Wednesday, with early signals pointing lower after the benchmark Nifty’s four-day winning streak.
On Tuesday, the Nifty rose 1.6% to close at 23,810, extending its gains for the fourth straight session. Over those four sessions, the index has added 4.3% in a sharp recovery. Easing crude prices, steady buying by foreign investors and hopes of a possible review of long-term capital gains tax for overseas investors all helped. Market watchers expect the Indian market to consolidate for a while, with a positive tilt.
Early signals point lower
GIFT Nifty, which trades on the NSE International Exchange and was formerly known as SGX Nifty, was down 50 points, or 0.21%, at 23,710 in early trade. That suggests Dalal Street will open in the red on Wednesday.
Investor anxiety also edged up. The India VIX, which tracks fear in the markets, rose 1.4% to 15.72.
Mixed mood across Asia
Asian markets inched higher as technology stocks that had been beaten down found buyers. Strong results from chipmaker AMD eased some worries about whether the boom in artificial intelligence can last.
Futures tracking major markets, however, were mostly weaker. S&P 500 futures fell 0.3% by 10 a.m. Tokyo time. Hang Seng futures lost 0.5%, while Nikkei 225 futures traded in Osaka fell 1.5%. Japan’s Topix slipped 0.6%, Australia’s S&P/ASX 200 dropped 0.5% and Euro Stoxx 50 futures declined 0.8%.
Wall Street ends mixed
The Nasdaq closed higher on Tuesday as investors moved back into chipmakers and other AI-linked stocks, helping the technology-heavy index recover some lost ground. The rally came ahead of the US midterm election results.
Apple, however, weighed on sentiment. The iPhone maker warned that rising memory chip costs would put further pressure on its margins, according to Reuters.
Gold, oil and the dollar
Gold prices edged higher in early Asian trade on Wednesday. Softer oil prices eased inflation worries, and investors were also waiting for the US midterm results and key labour market data that could shape policy.
Oil prices slipped in early trade as traders weighed the midterm outcome and its possible impact on peace talks in the Middle East. This came even though US crude stocks unexpectedly fell last week.
The dollar fell against most major currencies ahead of the midterm results, as investors prepared for what could be a strong showing by the Democrats.
Money flows and the rupee
Foreign portfolio investors bought shares worth Rs 6,836 crore on Tuesday. Domestic institutional investors, by contrast, were net sellers to the tune of Rs 3,679 crore.
The rupee gained 9 paise to settle at 94.75 against the US dollar on Tuesday. Inflows from foreign funds and heavy buying in domestic equities supported the currency.
Stocks under F&O ban
Kaynes and SAIL are in the futures and options ban today. Securities enter the ban period when their open positions in the F&O segment cross 95% of the market-wide position limit.
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