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The Indian stock market is poised for a positive opening on Monday, as indicated by the GIFT Nifty, which traded up by 105.50 points or 0.42% at 24,948. This suggests a bullish sentiment for the domestic indices, NSE Nifty 50 and BSE Sensex. The previous trading week ended with a positive note, as the NSE Nifty 50 rose by 11.65 points or 0.05% to close at 24,823.15, while the BSE Sensex gained 33.02 points or 0.04% to reach 81,086.21. The positive market sentiment is being driven by favorable global cues, particularly dovish comments from U.S. Federal Reserve Chair Jerome Powell, which solidified expectations of an interest rate cut in September. This led to a rally in U.S. stocks, with the tech-heavy Nasdaq Composite ending up by 1.47%, the S&P 500 by 1.15%, and the Dow Jones Industrial Average by 1.14%.
Despite the overall positive sentiment, the Nifty's gains were capped by mixed performance among heavyweight stocks. Experts like Ajit Mishra, SVP, Research at Religare Broking, believe that the Nifty has the potential to overcome the resistance at 24,850 and aim for new record highs, driven by the favorable global environment. However, sustained participation from the banking sector is crucial for driving momentum and pushing the Nifty towards the 25,500 level. The Bank Nifty, which also saw rangebound price action, is expected to resume its upmove after a period of consolidation. Technical analysts anticipate a potential move towards the 51,500-51,900 range in the short term.
The positive outlook is further supported by foreign institutional investor (FII) activity. FII bought shares worth Rs 1,944.48 crore on August 23, 2024, while domestic institutional investors (DII) mopped shares worth Rs 2,896.02 crore, indicating strong confidence in the Indian market. However, it's important to note that the NSE has added several stocks to the F&O Ban list for August 26, 2024, including Balrampur Chini Mills, Aarti Industries, Aditya Birla Fashion and Retail, Birlasoft, Chambal Fertilisers and Chemicals, GNFC, Granules India, Hindustan Copper, Indian Energe Exchange, India Cements, NALCO, RBL Bank, and Sun TV Network. This ban can restrict trading activity and may impact the overall market sentiment in the near term. As the market opens, traders will closely watch global market movements, crude oil prices, and technical indicators for cues on the direction of the Nifty and other indices.