Indian Stock Markets Open Lower Amid Oil Price Hike and Foreign Investor Selling

Indian Markets Open Lower Amid Elevated Crude Oil Prices and Foreign Selling

The Indian stock market opened lower on Friday, reversing early positive indications from GIFT Nifty. The Sensex was down 234 points or 0.3 percent at 77,430, while the Nifty fell 58 points or 0.24 percent to 24,115 at 09:19 am.

Despite the cautious start, the market's underlying fragility is highlighted by two consecutive sessions of decline. The key factors weighing on the domestic markets today include crude oil prices, foreign institutional investor (FII) activity, and weakness in IT stocks.

Crude Oil Prices Remain a Key Overhang Brent crude is hovering around the $106 per barrel mark amid ongoing tensions in the Middle East and concerns over disruptions in the Strait of Hormuz. Analysts say that fluctuations in crude prices, driven by uncertainty around US-Iran negotiations, continue to dictate near-term market direction.

Read also: Expert Portfolio Manager Raja Venkatraman Names Top Investment Picks for June 4

Foreign Institutional Investor (FII) Activity Remains a Pressure Point FIIs extended their selling streak for the fourth consecutive session on Thursday, offloading equities worth over Rs 3,200 crore. The renewed foreign selling, coupled with a spike in crude prices and weakness in the rupee, could continue to weigh on large-cap stocks.

Weakness in IT Stocks Adding to the Pressure on the Benchmarks Subdued guidance from major IT companies is weighing on market sentiment. Stocks such as Infosys, TCS, and HCL Tech were among the key laggards in early trade, dragging the Nifty IT index lower by over 1 percent.

Global Cues Mixed While US markets closed lower overnight amid concerns over geopolitical tensions and mixed earnings, sentiment improved slightly after market hours following the extension of the Israel-Lebanon ceasefire. However, elevated oil prices and uncertainty around negotiations continued to keep risk appetite in check.

Read also: MarketSmith India's 4 June Stock Recommendations

Volatility Remained Elevated India VIX rose over 1 percent to around 18.8, reflecting cautious positioning among investors. Technical indicators also pointed to a lack of strong directional momentum, with the Nifty trading below key resistance levels of 24,300-24,400, while immediate support is seen near the 24,000 zone.

Sector Trends Mixed While auto, PSU banks, and realty indices traded marginally higher, pressure was visible in IT and pharma stocks. Among Nifty constituents, Coal India, Grasim, Nestle, and ONGC were among the early gainers, while Cipla, Dr Reddy’s, HCL Tech, Sun Pharma, and Infosys were among the top losers.

Market Breadth Shows a Slight Positive Bias Market breadth showed a slight positive bias, with advancing shares outpacing declines, indicating selective buying in pockets of the market despite weakness in frontline indices.