Market Today: Sensex, Nifty Open Marginally Higher; IT Index Slides Over 3% as Global AI Trade Revives

Market Today, July 31: The domestic equity markets opened in the green on Friday, supported by gains in financial stocks even as the IT pack remained under pressure amid a global AI stock revival. The BSE Sensex was trading 49.44 points, or 0.06%, higher at around 77,978 in early trade, while NSE Nifty also edged up 31 points, or 0.14%, to 24,352, staying above the 24,300 mark.

Broader markets were positive. The Nifty Next 50 climbed 0.71%, while the Nifty 100 gained 0.25%, Nifty 200 added 0.22%, and the Nifty 500 rose 0.21%. Among the broader indices, the Nifty Smallcap 100 advanced 0.29%, while the Nifty Midcap 100 was up 0.10%.

Financials, auto and pharma lead gains; IT remains under pressure

Sectorally, buying was visible in financials and domestic-facing sectors. The Nifty Pharma index rose 0.78%, followed

by Nifty Auto at 0.72%, Nifty Financial Services at 0.70%, Nifty Metal at 0.61%, Nifty PSU Bank at 0.57%, and Nifty Bank at 0.36%.

However, technology stocks continued to weigh on sentiment. The Nifty IT index declined 3.06%, making it the worst-performing sector in early trade. FMCG also traded slightly lower, slipping 0.17%.

Out of 30 Sensex stocks, 22 were trading in green. Among the top gainers were Bajaj Finance (+3.66%), Bajaj Finserv (3.25%), Mahindra & Mahindra (1.86%), BEL (0.81%), and Maruti Suzuki (0.78%).

On the other hand, IT stocks were the top losers today amid the revival in AI stocks globally. Infosys was the top loser falling by 3.62%, followed by TCS (-3.23%), HCLTech (-3.12%), Tech Mahindra (-2.48%), and Eternal (-0.51%).

The Nifty IT Index was down 3.06 per cent in the opening trade on Friday.

Volatility eases as investors stay selective

India’s fear gauge, India VIX, declined 1.60% to 11.96, indicating relatively stable market expectations despite sharp moves in global technology stocks.

FII buying may provide resilience

V K Vijayakumar, chief investment strategist at Geojit Investments, said global markets are witnessing unusually high volatility, particularly in technology shares. He pointed to South Korea, where the Kospi has seen sharp index swings driven by outsized moves in heavyweight stocks such as Samsung and SK Hynix.

He said such extreme volatility is making institutional investors cautious, which may partly explain why foreign institutional investors (FIIs) have turned buyers in India in recent sessions.

“India is a stable market and the downside risks are limited now, particularly in large-cap stocks where valuations are reasonable and growth prospects remain healthy,” Vijayakumar said.

He noted that FIIs have purchased equities worth a cumulative Rs 7,360 crore over the past three trading sessions. While it is too early to call it a sustained trend, he believes the buying has the potential to lend resilience to the market. He also said the June quarter earnings released so far suggest that corporate earnings growth is beginning to regain momentum.

Global Cues

Asian markets rallied hard with Wall Street on Friday as South Korea’s battered market made a record comeback, stirring hopes that the recent selloff in AI-linked assets may be running out of steam.

South Korea’s Kospi leapt 14% shortly after the open on Friday, reversing steep losses from earlier in the week. Japan’s Nikkei similarly advanced 5% and MSCI’s broadest index of Asia-Pacific shares outside Japan rose 3%.

That followed surges in AI heavyweights Microsoft and Amazon overnight, lifting chip stocks broadly after upbeat earnings and forecasts from the pair eased concerns over hefty capital spending.

Nasdaq futures were up 0.87% and S&P 500 futures added 0.29%. In Europe, EUROSTOXX 50 futures advanced 0.57%, while FTSE futures and DAX futures rose 0.4% each.