Domestic Equities Open with Gains Following Heavy Selling Pressure

In New Delhi on August 29, domestic equities showed an upward trend as trading commenced, with benchmark indices recovering from the heavy selling they faced the day before. The Nifty 50 index opened higher at 24,546.25, reflecting a rise of 45.35 points or 0.19 percent. Similarly, the BSE Sensex saw a boost, starting at 80,227.21 and gaining 146.64 points or 0.18 percent.

Market analysts noted that although the current mood is somewhat pessimistic, the earlier sell-off has resulted in the markets being oversold, creating room for a bounce back. Ajay Bagga, a banking and market expert, pointed out that the Indian markets experienced a subpar expiry on Thursday, and with negative returns in July and August, the transition into September was marked by cautious expectations. However, he indicated that earnings downgrades might have peaked in Q1 of FY2026, forecasting a potential gradual improvement in market conditions for the second half of the fiscal year. He also mentioned the anticipation of consumption-boosting tax cuts through a GST 2.0 announcement expected on September 4th.

On the global stage, the US Q2 GDP figure was revised upwards to 3.3 percent from an earlier estimate of 3 percent, propelling US stocks and reaching record highs on the S&P 500. Market experts are also awaiting the US PCE index data, and if inflation aligns with projected multi-month highs, it could maintain the prospect of a US Federal Reserve rate adjustment on September 17th.

Across the broader market on the NSE, indices such as the Nifty 100 and Nifty Midcap 100 also opened in the green, reflecting gains of 0.21 percent and 0.19 percent, respectively. The Nifty Smallcap 100 saw an increase of 0.29 percent as well. Among the sector-specific indices, all except Nifty Auto opened positively, led by a 0.8 percent jump in the Nifty FMCG index, along with modest increases in Nifty IT, Media, Metal, and Pharma sectors.

Shrikant Chouhan, head of equity research at Kotak Securities, mentioned that despite the weak short-term outlook, a significant recovery is possible due to oversold conditions. He advised day traders on critical levels to watch, indicating that while the market remains below 24,700/80,900, weak sentiment might persist, whereas breaking above these levels could propel the market further. In the mixed performance of other Asian markets, Japan's Nikkei 225 fell by 0.14 percent, while Singapore's Straits Times and South Korea's KOSPI showed varied trends, with some indices gaining while others faced pressure.