Sensex Gains 228 Points, Nifty Rises As IT Stocks Lead; Warsh Speech In Focus

Indian equity markets opened higher on Friday, although investor sentiment remained cautious amid elevated crude prices, firm US bond yields and geopolitical uncertainty surrounding the Strait of Hormuz.

At 9:17 am, the Sensex was up 228.48 points, or 0.30%, at 77,162.07, while the Nifty gained 42.65 points, or 0.18%, to 24,133.50.

IT stocks led the gains on the Nifty 50, with Tech Mahindra rising 2.74%, followed by TCS at 2.21%, Infosys at 2.10% and HCL Technologies at 1.99%.

On the other hand, Bajaj Finance fell 1.33%, while Adani Enterprises declined 0.82%, Bajaj Finserv slipped 0.79% and UltraTech Cement dropped 0.64%.

Crude Oil, Hormuz Remain Key Risks

Crude oil remained a key factor for Indian markets, with WTI hovering around $83-84 a barrel. Developments involving Iran and Oman over traffic through the Strait of Hormuz could influence oil prices, the rupee and broader market sentiment.

V K Vijayakumar, Chief Investment Strategist at Geojit Investments, said Brent crude had again moved above $89 as there were no signs of a diplomatic solution to reopen the Strait of Hormuz.

“Total lack of clarity on this issue is weighing on the market,” Vijayakumar said.

He added that the AI trade continued to boom following Nvidia's strong results and guidance, while firm US bond yields amid inflation concerns remained another headwind for equities.

According to Vijayakumar, these factors are keeping the Nifty within the 24,300-24,600 range. A breakout above this range, he said, would require participation from heavyweight stocks including HDFC Bank, Reliance Industries, L&T and IT majors.

“For this to happen, the major headwinds of elevated crude price and high U.S. bond yields have to disappear or at least weaken,” he said.

Nvidia Rally, Fed Speech In Focus

Global cues remained mixed but broadly supportive after strong quarterly results from Nvidia lifted AI-linked technology and semiconductor stocks. The Nasdaq ended around 1.5% higher, while Asian markets were mixed, with Japan trading firmer and South Korea weaker.

Investors will closely track Fed Chair Kevin Warsh's first Jackson Hole keynote for clues on the US central bank's September policy outlook. Market participants are also watching whether firm US bond yields and inflation concerns could influence the path of interest rates.

Vijayakumar said the Fed chief's commentary at the Jackson Hole symposium would be closely watched for signals on interest rates.

Despite the range-bound movement in the Nifty, he noted that there was brisk activity in the small- and mid-cap segments.

Analysts continue to advise selective stock picking, disciplined risk management and a buy-on-dips approach, particularly in fundamentally strong stocks.