GIFT Nifty futures fell nearly 200 points on Friday. This drop signals a weak start for Indian benchmark indices after a six-day rally. The decline follows a major selloff in global markets, especially in U.S. technology stocks. The Nasdaq dropped 5.5%. Analysts from Livemint say this downturn comes as investors rethink the impact of the recent U.S. midterm elections on foreign policy and AI regulations.
Key Details
On Thursday, the Nifty 50 and BSE Sensex gained 2.4% and 2.6%, respectively. This rise was supported by falling crude oil prices and strong foreign fund inflows. Foreign institutional investors bought stocks worth about 150 billion rupees ($1.6 billion). This marked their largest single-day net purchase in nearly six years. The positive sentiment was helped by Brent crude prices falling below $100 a barrel. This drop is expected to ease inflationary pressures in India.
Background
As of 7:49 a.m. IST, GIFT Nifty futures were trading at 24,460. This indicates a weaker opening for the benchmark Nifty 50, which closed at 24,536.6 on Thursday. Analysts suggest that the expected decline is relatively small compared to the broader global selloff. Some attribute this resilience to India's limited exposure to the AI-hardware sector. However, volatility is expected as profit-booking may happen after recent gains.
The decline in GIFT Nifty is likely to affect Indian equities, especially the Nifty 50 and BSE Sensex. Investors will react to global market trends and reassess their positions. Lower crude oil prices might provide some support, but the overall sentiment remains cautious amid the global selloff. Watch for further developments in U.S. markets and any updates on foreign policy that could influence investor sentiment.
Based on reporting by: moneycontrol.com, livemint.com