Stock markets open flat amid external pressure, RBI policy outcome to provide further direction

The domestic benchmark indices opened flat on Thursday as bulls and bears attempted to pull the markets towards their sides amid external pressure, even as domestic indicators offered support. The Nifty 50 index opened almost unchanged at 25,981.85, slipping -4.15 points (-0.02 per cent), while the BSE Sensex also began flat at 84,987.56, registering a marginal dip of -119.25 points (-0.14 per cent). Market experts said that Indian equities are currently moving through a corrective phase with the upcoming RBI monetary policy announcement expected to provide further direction to investor sentiment. Ponmudi R, CEO, Enrich Money, said, "Indian equities remain in a short-term corrective phase, largely due to FII outflows and rupee weakness, even as the broader economic structure remains strong. Corporate earnings visibility, infrastructure spending, policy continuity and steady consumption continue to support the long-term growth story. However, in the near term, markets are still digesting record-high levels, making price confirmation more important than sentiment." Ponmudi added that a supportive RBI stance on growth and liquidity could trigger short-covering in the market while any surprise hawkish tone or signs of sticky inflation could result in selling pressure.

In the broader market movement on the NSE, the Nifty 100 opened 0.14 per cent down, while Nifty Midcap managed to stay marginally positive at 0.07 per cent, and Nifty Small Cap 100 was down by 0.30 per cent, indicating mixed investor sentiment across segments. On the sectoral front, most indices were under pressure at the opening bell. Only Nifty Auto, IT and Metal showed resilience, while Nifty FMCG fell 0.22 per cent, Media dropped 0.58 per cent, and Nifty Pharma lost 0.12 per cent. Global cues also played a role in keeping traders cautious. Asian markets were trading mixed with mild pressure, while U.S. and European markets remained largely stable and controlled. The movements in U.S. indices, bond yields, crude oil prices and the U.S. dollar are closely influencing near-term risk appetite. Any sharp move in the S&P 500 or Nasdaq is likely to reflect immediately through foreign investor activity in India, particularly in the IT, BFSI and export-driven sectors. Meanwhile, higher U.S. bond yields continue to tighten global liquidity, increasing volatility in global markets. Crude oil and the USD/INR trajectory remain crucial for India's inflation and currency outlook. With the RBI policy decision approaching, volatility is expected to stay elevated, keeping traders cautious through the session.