Stock markets are poised to start the day on a positive note this Friday, buoyed by robust earnings from Tata Consultancy Services (TCS) and favorable global indicators. GIFT Nifty futures were at 23,909.50 at 8:08 am, suggesting that the Nifty 50 could open higher than the previous day’s close of 23,775.10.
This optimistic beginning follows a significant surge earlier in the week, with the Nifty climbing by 4.7% and the Sensex by 4.5%, driven by reduced tensions in the West Asia region post a temporary truce between the United States and Iran.
Aakash Shah, Technical Research Analyst at Choice Equity Broking Private Limited, mentioned, “Equity markets are anticipated to open slightly positive today, tracking the strong performance of GIFT Nifty, currently trading around 23,800, up approximately 30 points. Nevertheless, there might be an air of caution following a sharp decline in the previous session.”
Investor sentiment is further bolstered by Tata Consultancy Services reporting better-than-expected results, with a 9.7% revenue increase and a 12.2% rise in net profit for the March quarter. The company also noted a consistent demand despite the emergence of artificial intelligence tools.
Analysts have indicated that TCS’s outlook remains steady amidst global uncertainties. “Management commentary suggests a more optimistic outlook compared to previous quarters despite prevailing macro uncertainties,” as per analysts led by Vikas Ahuja of Antique Stock Broking.
Crude oil prices remained below $100 per barrel in early trading, providing relief to global markets. Brent crude stood near $96.37 per barrel, up by 0.45%, while WTI crude was at $98.58, up by 0.73%. Lower oil prices are advantageous for India as they alleviate inflation and economic pressures.
Despite these positive signals, foreign investors continued to offload Indian equities. Foreign institutional investors divested shares worth about Rs 1,711.19 crore in the cash market on Thursday. They also sold Rs 84.26 crore in index futures and Rs 124.28 crore in stock futures, along with Rs 458.42 crore in stock options. However, there was some buying activity in index options worth Rs 2,320.01 crore.
On the flip side, domestic institutional investors remained buyers, acquiring shares valued at Rs 955.90 crore. Asian markets were trading approximately 0.9% higher, contributing to positive market sentiment.
Nonetheless, uncertainties persist regarding the sustainability of the US-Iran ceasefire, particularly amidst ongoing tensions involving Israel and Lebanon. Iran has highlighted persistent strikes as a critical concern in its agreement with the US, which could keep markets on edge.
The day is expected to kick off positively due to earnings and global cues, but the trajectory will hinge on unfolding global events and the continuation of foreign selling. Investors are likely to exercise caution despite the prevailing positive market sentiment in the short term.