Indian benchmark indices Sensex and Nifty are likely to open on a muted note on Thursday, with GIFT Nifty indicating a flat-to-negative start. A bullish outlook from Nvidia has boosted technology and semiconductor stocks across Asia, while a further decline in crude oil prices offers support to Indian equities. However, hotter-than-expected US inflation data and lingering geopolitical uncertainty could keep investors cautious.
GIFT Nifty was trading at 24,366 around 7:40 am, down 30 points, or 0.12 percent. Indian equities failed to build on the previous session's gains on Wednesday, with the Nifty closing near the day's low. The Sensex fell 183.15 points, or 0.24 percent, to 77,472.94, while the Nifty declined 126.80 points, or 0.52 percent, to 24,207.75.
Asian equities advanced after Nvidia issued a bullish sales outlook, easing concerns that the rapid expansion in AI-related capital expenditure could be losing momentum. The upbeat outlook could also provide a positive read-through for technology stocks globally after concerns over the scale and returns from AI spending triggered bouts of sharp selling in the sector over recent weeks.
Share Markets Live Updates | Sensex, Nifty, GIFT Nifty Today
MSCI's Asia-Pacific equities gauge rose 0.3 percent, with semiconductor stocks leading the advance. South Korea's Kospi gained 1.1 percent, supported by stocks including SK Hynix and Samsung Electronics, while Japan's Topix advanced 0.9 percent. Nvidia shares jumped 4.7 percent in extended US trading after its outlook signalled continued strong sales growth. Nasdaq 100 futures rose as much as 1.3 percent following the announcement before paring some gains, while S&P 500 futures were up 0.4 percent.
The positive reaction to Nvidia came after US stocks had finished marginally lower in regular trading on Wednesday as a hotter-than-expected inflation reading weighed on sentiment. The Dow Jones Industrial Average fell 0.21 percent to 53,463.88, while the S&P 500 slipped 0.02 percent to 7,675.70 and the Nasdaq Composite declined 0.08 percent to 26,130.20.
The inflation data could keep the outlook for US interest rates and Treasury yields in focus. Higher-for-longer rates and elevated bond yields have emerged as a key concern for global equity markets in recent weeks, particularly for richly valued technology stocks and emerging-market assets.
Falling crude oil prices provide a favourable cue for Indian markets. Brent crude futures declined 0.7 percent to $87.24 a barrel on Thursday, extending their fall to a fourth consecutive session. US West Texas Intermediate crude dropped 0.7 percent to $81.67 a barrel, its fifth straight session of losses.
Oil prices have eased on expectations that talks between Iran and Qatar could help reopen the Strait of Hormuz and reduce disruptions to energy supplies stemming from the Middle East conflict.
Bajaj Broking said the Nifty could remain in the 24,000-24,350 range unless it closes above 24,360, a breakout that could extend the recovery towards 24,550-24,700. Short-term support is seen at 24,000-23,800.
Institutional flows remained supportive despite Wednesday's decline in the benchmark indices. Foreign institutional investors (FIIs) were net buyers for a second consecutive session, purchasing Indian equities worth Rs 502 crore on August 26. Domestic institutional investors (DIIs) recorded much stronger purchases, investing Rs 6,425 crore in equities.
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