Indian shares likely to open flat as oil surge counters strong foreign inflows
- GIFT Nifty futures were at 25,267.5
Indian equities consolidate amid strong foreign inflows, balancing concerns over rising crude oil prices and elevated domestic inflation. The market shows resilience after recent underperformance.
- Sustained foreign institutional investment trends.
- Impact of rising crude oil prices and domestic inflation.
- India's equity market turnaround and outlook.
- Global AI stock sentiment and Nvidia CEO resignation.
Indian equity benchmarks are expected to remain in consolidation mode on Friday following recent gains, as sustained foreign institutional inflows offer support while rising Brent crude prices and elevated domestic inflation weigh on sentiment.
GIFT Nifty futures were at 25,267.5, as of 7:13 a.m. IST, indicating a muted opening for Nifty 50, which ended at 25,299.35 on Thursday.
Foreign investors continued their strong buying streak, recording net purchases of 78.31 billion ($832.71 million) in Indian equities on Thursday, according to provisional data.
This marked their ninth consecutive session of net buying. November inflows have already reached $8 billion, the highest monthly tally since December 2020.
The Nifty 50 and Sensex have gained 1.1% so far this week, setting the stage for a third consecutive weekly rise. The recovery signals a turnaround for India’s equity market after nearly two years of underperformance against emerging-market peers.
Elevated crude oil prices and India’s relatively limited exposure to the AI theme had weighed on market performance over the past two years.
However, global enthusiasm for AI stocks has recently eased due to concerns over increased scrutiny of data-centre investments following Democratic win in US mid-term elections.
Adding to domestic concerns, India’s retail inflation accelerated to 6.09% in October, breaching the Reserve Bank of India’s upper tolerance of 6%. Rising food prices have squeezed household budgets and fuelled expectations of further monetary tightening.
Brent crude futures traded around $95.23 per barrel, from $92 during India equity market close on Thursday, as attacks on Saudi energy infrastructure escalated and shipping disruptions through the Strait of Hormuz threatened global oil flows.
Stocks in Asia were on steadier footing on Friday after a turbulent week dominated by revelations of extramarital affairs involving Nvidia CEO Jensen Huang that culminated in his resignation, in a blow to the global AI boom he helped advance.