Amid improved global and domestic sentiment, the Indian market opened on a positive note on Wednesday. Benchmarks Nifty 50 and Sensex opened higher by around 0.25%, and gained upto half per cent soon after opening.
The broader Nifty50 opened above 15, 800 and Sensex added over 200 points in the opening trade. The two indices opened at 15,818.20 and 53,170.70.
In the broader market, Nifty midcap and smallcap were trading higher by 0.5% and 0.4% respectively as India VIX approached 21-mark.
On the sectoral front, except Metal, Media, Oil & gas, all other Nifty indices traded in the green. Nifty Metal declined more than one and half per cent, while Bank, Auto gained the most in the opening trade.
In the pre-open, the Sensex traded flat with positive bias as the index gained around 40 points with 20 stocks advancing, 9 declining and one remaining neutral on the 30-share index.
“There are lots of signals from markets: Brent crude crashed to near $100 a barrel, dollar index rose above 106, rupee again depreciated to an all-time low, euro is at 20-year low to the dollar and, perhaps most importantly from Indian market perspective, FIIs turned buyers after a long gap,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
While crude crash along with corrections in other commodities like metals is a bearish signal indicating increasing possibility of recession in the US, commodity crash is positive for the Indian economy and FIIs turning buyers is a bullish signal for Indian equity market, said the expert.
It is important to watch whether these signals are one offs or will they sustain, he underlined.
“With valuations reaching fair levels, investors can buy high-quality stocks in a calibrated manner. Stocks that FPIs sell like financials and IT are good segments to bet now,” the expert added.
Earlier, the cues from the Asian market largely remained negative on Wednesday morning.
Japanese Nikkei 225 was seen trading lower by 1.25%, while Hang Seng Index and Chinese Shanghai Composite at the Hong Kong Exchange traded lower by half per cent each.
However, SGX Nifty was trading higher by marginal gains of 40 points to trade at 15,806 in the morning trade on the Singaporean Exchange on Wednesday.
On Tuesday, the US market Dow Jones gained 0.42%, Nasdaq rose 1.75% and S&P 500 ended with 0.16% gain amid high volatility on Tuesday.