Sensex Nifty Open Higher After 25-Year Losing Streak

India’s benchmark equity indices Sensex and Nifty opened higher on Monday after suffering their eighth consecutive weekly decline, their longest losing streak in 25 years. Gains were supported by easing expectations of an aggressive US Federal Reserve rate hike and a pullback in crude oil prices, although persistent foreign selling continued to weigh on investor sentiment.

The Sensex gained more than 400 points in the opening minute, while the Nifty 50 also started the session in positive territory. Investors were encouraged by softer-than-expected US jobs data, which reduced expectations of a Federal Reserve rate increase later in October and offered some relief to emerging-market assets.

Sensex, Nifty Start Monday Session on a Stronger Note

At 9:15 am, the Sensex was up more than 400 points as trading began. The positive opening followed a difficult period for Indian equities, with both major benchmarks recording their eighth straight weekly decline last week.

The Nifty 50 had closed at 22,421.95 on Thursday, while markets remained shut on Friday because of a public holiday. GIFT Nifty futures were trading around 22,639 points at 7:57 am on Monday, indicating a stronger opening for the benchmark index.

The latest gains come after a prolonged period of pressure in which investors have been dealing with heavy foreign portfolio outflows, elevated crude oil prices and a sharp rise in global bond yields.

Why Indian Stock Markets Have Been Under Pressure

Indian equities have faced several challenges in recent weeks. The combination of expensive crude oil, higher global borrowing costs and sustained foreign selling has reduced investors’ willingness to take risks in emerging markets.

The eighth consecutive weekly decline for the Sensex and Nifty marked the longest such losing streak in 25 years. Persistent selling by foreign portfolio investors has been one of the most important factors behind the recent weakness.

Higher crude prices are particularly important for India because the country imports a large share of its crude oil requirements. A prolonged rise in energy costs can increase pressure on the country’s import bill and inflation, while also affecting corporate profitability and household spending.

At the same time, rising bond yields in major economies can make developed-market assets relatively more attractive to global investors. This can contribute to capital outflows from emerging markets such as India.

Softer US Jobs Data Eases Fed Rate Hike Concerns

One of the biggest positive signals for Indian markets came from the United States, where weaker-than-expected jobs data reduced expectations of another Federal Reserve rate hike later this month.

Lower expectations for US monetary tightening can support emerging-market equities because investors may face less pressure to move capital toward US dollar-denominated assets. A less aggressive Federal Reserve can also reduce concerns about tighter global financial conditions.

According to traders cited in the report, the probability of an October Fed rate hike has fallen below 25%. This change in expectations helped improve sentiment across emerging markets at the start of the new trading week.

For Indian investors, however, the improvement in global sentiment may not automatically translate into a sustained market recovery. Traders said that a more durable rebound would likely require further easing in crude oil prices and a slowdown in foreign investor outflows.

Crude Oil Prices Provide Some Relief

Oil prices also offered some support to Indian equities on Monday. Brent crude slipped about 0.6% to $101.6 a barrel as higher Middle Eastern exports and coordinated emergency stock releases by Group of Seven nations reduced some immediate concerns about global supply.

Lower oil prices are generally positive for India because cheaper crude can reduce pressure on the country’s import bill. It can also ease concerns over inflation and provide some support to sectors and companies that are sensitive to energy costs.

However, crude remained above the $100-a-barrel level, meaning energy prices continued to represent a significant risk for the Indian economy and financial markets.

Investors are therefore likely to keep a close watch on developments in the Middle East, crude exports and emergency oil-stock releases in major economies.

Asian Markets Also Trade Higher

Indian equities were supported by a broadly positive trend across Asian markets. Other Asian stock markets were up about 0.2% on Monday as investors responded to the changing outlook for US monetary policy.

The improvement in global risk sentiment came after investors reassessed the likelihood of further US interest-rate increases following weaker economic data.

For emerging-market investors, the combination of softer US rate expectations and a modest decline in crude prices provided two important reasons for renewed optimism at the start of the week.

Foreign Investors Continue to Sell Indian Stocks

Despite the stronger opening, foreign investor selling remains a major concern for the Indian market.

Foreign portfolio investors remained net sellers for a sixth consecutive trading session on Thursday, selling shares worth ₹94.84 billion, according to provisional data from the National Stock Exchange.

Domestic institutional investors provided an important counterbalance. DIIs purchased equities worth ₹100.42 billion on Thursday, exceeding the value of foreign selling during the session.

The contrasting behaviour of foreign and domestic investors has become an important feature of the Indian market. Domestic institutional buying can help absorb some of the shares sold by overseas investors, but sustained foreign outflows can continue to put pressure on benchmark indices.

Why Foreign Investor Flows Matter for the Nifty and Sensex

Foreign portfolio investors are important participants in Indian equity markets, particularly in large and liquid companies that have significant weight in major benchmarks.

When global investors reduce their exposure to Indian equities, selling pressure can spread across large-cap stocks and affect broader market sentiment. Continued outflows can also influence the Indian rupee and increase volatility in domestic markets.

However, strong buying by domestic institutions can provide a degree of stability. The latest figures show that domestic investors purchased more equities than Foreign Investors sold during Thursday’s session.

Whether that trend continues will be important for the market’s direction in the coming sessions.

HDFC Bank Shares in Focus After CEO Appointment

Among individual stocks, HDFC Bank is expected to remain in focus after the lender announced the appointment of Anup Bagchi as its next managing director and chief executive officer.

Bagchi, currently the MD and CEO of ICICI Prudential Life Insurance, has been selected to lead India’s largest private-sector bank for a three-year term.

His appointment is notable because he will become the first external candidate to take charge as CEO of HDFC Bank. The move is therefore likely to attract attention from investors and analysts assessing the bank’s next phase of growth.

What Investors Will Watch Next

The direction of Indian equities in the near term is likely to depend on several domestic and global factors. Movements in crude oil prices, foreign portfolio flows and expectations for US interest rates will remain particularly important.

Investors will also monitor global bond yields. A sustained rise in US Treasury yields could again pressure emerging-market assets, while a decline in yields could improve the relative attractiveness of equities in markets such as India.

Corporate developments will provide another source of stock-specific movement. Large companies, including HDFC Bank, could see increased attention as investors assess earnings prospects, management changes and business strategies.

Can Sensex and Nifty Sustain the Recovery?

The positive opening provides some relief after an unusually long period of weekly declines, but it does not by itself establish a lasting market reversal.

The recent weakness has been driven by several factors rather than a single issue. Foreign selling, high crude oil prices and elevated global bond yields have combined to weaken risk appetite.

A sustained improvement would therefore require several of these pressures to ease simultaneously. A continued decline in oil prices could benefit India’s external finances, while lower US rate expectations could improve global liquidity conditions.

At the same time, a reduction in foreign selling would strengthen the case for a more durable recovery. Domestic institutional buying remains an important source of support, but investors will be watching whether overseas flows begin to stabilize.

Key Factors to Watch for Indian Markets

• US Federal Reserve expectations after weaker-than-expected jobs data.
• Crude oil prices and developments affecting Middle Eastern supply.
• Foreign portfolio investor selling and domestic institutional buying.
• Global bond yields and their impact on emerging-market assets.
• Corporate developments, including HDFC Bank’s leadership transition.

FAQs

Why did Sensex and Nifty open higher on Monday?

Indian benchmark indices opened higher after softer US jobs data reduced expectations of an October Federal Reserve rate hike. A decline in crude oil prices also supported sentiment.

How long was the recent losing streak for Sensex and Nifty?

Both the Sensex and Nifty recorded their eighth consecutive weekly decline, marking their longest weekly losing streak in 25 years.

What was the Nifty 50 closing level before Monday’s session?

The Nifty 50 closed at 22,421.95 on Thursday. Indian markets were closed on Friday because of a public holiday.

Why are crude oil prices important for Indian stocks?

India imports a large share of its crude oil requirements. Higher oil prices can increase import costs and inflationary pressure, while lower prices can provide relief to the economy and businesses.

What happened to foreign investor flows?

Foreign portfolio investors remained net sellers for a sixth consecutive session on Thursday, selling equities worth ₹94.84 billion according to provisional NSE data.

Are domestic investors supporting the Indian market?

Yes. Domestic institutional investors purchased equities worth ₹100.42 billion on Thursday, helping offset some of the selling by foreign investors.

Why is HDFC Bank in focus?

HDFC Bank is in focus after appointing Anup Bagchi, currently MD and CEO of ICICI Prudential Life Insurance, as its next CEO for a three-year term.

What could determine whether the market recovery continues?

A sustained recovery could depend on further easing in crude oil prices, reduced foreign outflows, global bond yields and expectations for US monetary policy. Investors will also track corporate developments and earnings.