Nifty, Sensex open cautious on day of Trump-Xi meet; Experts expect new highs soon for Indian markets

The domestic stock markets opened on a cautious note on the day of the crucial meeting between U.S. President Donald Trump and Chinese President Xi Jinping, with experts expecting Indian markets to touch new all-time highs in the coming weeks. The Nifty 50 index opened at 25,984.40 with a marginal dip of 69.50 points or 0.27 per cent, while the BSE Sensex opened at 84,754.92, down 242.21 points or 0.28 per cent.

Experts noted that despite the cautious start, Nifty could hit a new all-time high in the next couple of weeks, ending 13 months of negative returns. Market sentiment is supported by expectations that earnings have bottomed out and that sectors such as financials, power, industrials, and autos will lead the next phase of growth. Ajay Bagga, Banking and Market Expert, told ANI, "Indian markets are treading water on the back of the global developments. Nifty may hit a new all-time high in the next couple of weeks, ending 13 months of negative returns. Earnings have bottomed out and expectations are that financials, power, industrials, and autos could lead the markets hereon. Like in the June expiry, where FPIs bought a massive amount on the expiry day, only to sell off the next day, October expiry's massive buying was followed up with a 2000 crore plus sell off to start the new series."

He added, "Though FPIs have cut their net short positions from 94 per cent to 80 per cent, they remain largely bearish at the index levels. With the catalyst of a US-India trade deal being ruled as a distant possibility by the Indian government and with Bihar elections being a mini-referendum on the stability of the coalition government at the federal level, expect volatility through mid-November at least." In the broader market, Nifty 100 declined by 0.18 per cent, while Nifty Midcap 100 was up by 0.24 per cent, and Nifty Smallcap 100 also gained 0.17 per cent.

Among the sectoral indices on NSE, Nifty IT was down by 0.05 per cent, Auto was up by 0.23 per cent, while Metal, Pharma, and Consumer Durables were under pressure. Globally, all eyes are on the Xi-Trump Summit. The U.S. Federal Reserve cut rates as expected, with Chair Jerome Powell announcing the end of Quantitative Tightening (QT) from December 1. Powell's remarks were seen as hawkish, leading to a slight fall in U.S. markets and a rise in Treasury yields.

He emphasized that a December rate cut was far from a foregone conclusion, which did not sit well with complacent markets. The Bank of Japan (BOJ) and European Central Bank (ECB) are expected to hold rates for now. China, ahead of the summit, seeks stability, respect, and recognition of its interests in Taiwan and the South China Sea, along with an end to the trade war. Analysts noted that while the U.S. aims to regain its lost manufacturing strength, China appears prepared to wait out the negotiations.

In the IPO segment, two major issues are in focus. Studds Accessories, a Faridabad-based manufacturer of two-wheeler helmets and motorcycle accessories, is set to open its Rs 455.49 crore IPO today. The issue is entirely an offer-for-sale (OFS) with a price band of Rs 557 to Rs 585 per share. Meanwhile, Orkla India, which offers a diverse range of food products including snacks, beverages, and desserts, saw its public issue subscribed to 79 per cent on day one. The bids were led by institutional investors (1.53 times), retail investors (90 per cent), and QIBs (2 per cent).

On the commodities front, Manav Modi, Analyst, Precious Metals Research, Motilal Oswal Financial Services, said, "Gold price languished after a slight pullback in yesterday's session following a mixed Fed meeting and recovery in the Dollar index and Yields. With the rate cut, Governor Powell announced to put an end of QT by Dec. 1 and raised concerns regarding rising inflation and the labour market. Focus now shifts to U.S. President Trump's meeting with Chinese leader Xi Jinping in South Korea later in the day." As global cues dominate sentiment, Indian markets are expected to remain volatile but optimistic, with analysts seeing potential for a rally in the coming weeks. (ANI)