Indian markets are set for a positive opening following a global recovery in Asian and US equities. While sentiment has improved, investors are keeping a close watch on persistent foreign institutional selling and Brent crude oil prices staying above $105 per barrel, which remain key hurdles for market stability.
Indian benchmark indices, the Sensex and Nifty, are expected to open in the green on Friday. The GIFT Nifty, which acts as an early indicator of market sentiment, is trading at 23,072, pointing to a potential gain of approximately 84 points at the start of trade.
The positive outlook follows a broad recovery across Asian markets and a stable finish on Wall Street. Global investors appear to be stabilizing their positions after recent volatility in the technology and artificial intelligence sectors. In the United States, there has been a notable shift as capital moves from high-valuation tech firms toward more stable sectors such as healthcare and consumer goods. This rotation often influences how investors look at companies within Indian markets as well.
However, despite the improved mood, the market faces significant structural pressure. Foreign institutional investors (FIIs) have been net sellers, offloading shares worth Rs 5,285 crore in the previous session. This sustained selling trend has been a primary reason for recent market volatility, as domestic buying has only partially offset the exit of foreign capital.
Another major concern for the market is the price of energy. Brent crude oil continues to hover above the $105 per barrel level. Elevated oil prices are typically negative for the Indian economy because they increase input costs for many manufacturing and transport-related businesses. When input costs rise, companies may face pressure on their profit margins, which investors monitor closely to gauge the health of corporate earnings. Geopolitical uncertainties and fluctuating global bond yields further add to the complexity, often limiting the upside for domestic indices.
For investors, the key monitorables will be whether the positive global sentiment can sustain itself against the ongoing FII selling spree. Keeping an eye on daily trade volumes and the direction of crude oil prices will be essential to understand if this rebound has staying power or if the current market range will remain tight.