CHENNAI: Indian equity markets opened on a weaker note Friday morning, retracing some of the sharp gains seen in the previous session. As of 9:16 AM IST, the Nifty50 slipped below the psychological 25,000 mark, trading at 24,996.00, down 66 points or 0.26%. The BSE Sensex was also in the red, declining 242 points or 0.29% to 82,288.75.
This cooling off follows a robust two-day rally, including Thursday’s significant rebound, which saw the Nifty spike nearly 550 points from intraday lows—driven largely by unexpected foreign institutional investor (FII) activity.
Contrarian FII Buying Spurs Market Momentum
Analysts believe that investor sentiment had been cautious on expectations that FIIs might pare down exposure to Indian equities, favoring comparatively cheaper Chinese markets amid signs of easing US-China trade tensions. This sentiment led to an increase in cash holdings among domestic mutual funds and prompted some domestic institutional investors (DIIs) to turn sellers.
However, defying expectations, FIIs stepped in with significant purchases worth Rs 5,393 crore on Thursday, catalyzing a sharp reversal and catching many market participants off guard.
Market Outlook
While today's opening reflects some profit-taking and short-term consolidation, underlying volatility remains high amid global cues, sectoral shifts, and institutional behavior. The market will closely watch FII flows and policy signals for further direction.
Investors are advised to remain cautious and adopt a stock-specific approach, especially ahead of key domestic macroeconomic data and global geopolitical developments.