Sensex, Nifty opening: Will stock market crash or open higher today?

GIFT Nifty was trading at 22,820 at 8:11 am on Tuesday, indicating a muted start for the Nifty 50, which closed at 22,780.25 on Monday.

In Short

• GIFT Nifty indicated a flat opening after Monday's sharp benchmark sell-off
• Brent stayed above $106, heightening inflation and import bill concerns
• Analysts see 22,700 as crucial support, with 22,400 the next downside

Benchmark indices are likely to see a muted start on Tuesday after the Sensex and Nifty slipped to near six-month lows in the previous session. Rising crude oil prices, continued foreign investor selling and elevated US Treasury yields remain key concerns for the market, even as early signals point to a largely flat opening.

GIFT Nifty was trading at 22,820 at 8:11 am on Tuesday, indicating a muted start for the Nifty 50, which closed at 22,780.25 on Monday.

The market is coming off a sharp sell-off, with the benchmarks extending their losing streak as concerns over the US-Iran conflict pushed crude prices higher. Brent crude was trading at $106.52 a barrel, up 1.18%, while WTI crude rose 1.02% to $93.70.

CRUDE OIL REMAINS THE BIGGEST WORRY

Higher crude prices remain a major risk for Indian equities as India is heavily dependent on oil imports. Sustained prices above $100 can increase the import bill, add to inflationary pressure and squeeze corporate margins.

The rise in oil prices comes amid continued uncertainty over the US-Iran conflict and concerns around supply through the Strait of Hormuz.

Pabitro Mukherjee, Deputy Vice President-Research, Bajaj Broking, said the Nifty formed a "sizeable bearish candle" on the daily chart, making a lower high and lower low, which indicates continuation of the prevailing downtrend.

He said a decisive break below 22,700 could intensify selling pressure and drag the Nifty towards 22,400. On the upside, the index would need to reclaim the 23,000-23,100 level to signal a pause in the ongoing correction, with 23,400 emerging as the next major resistance zone.

FII SELLING ADDS TO PRESSURE

Foreign institutional investors continued to sell Indian equities on Monday, offloading shares worth Rs 5,353 crore, their highest daily outflow in four weeks, according to provisional exchange data.

Domestic institutional investors bought shares worth Rs 5,189 crore, offering some support. However, the continued foreign selling remains a concern as global bond yields stay elevated.

Adani Group stocks are likely to remain in focus after Sebi disposed of proceedings against group chairman Gautam Adani and four group companies in a case related to public-float violations.

The case involved compliance with the 25% minimum public-shareholding requirement and disclosures related to promoter-linked holdings. Sebi imposed penalties of Rs 20 lakh each on two individuals in the case for wrongful disclosures.

Tata Group companies will also be watched after Tata Trusts proposed merging two group companies with Tata Sons to prevent a listing that could be triggered by Reserve Bank of India rules.

Mukherjee said the Nifty opened weak on Monday, slipped below last week's low of 23,020 and continued to decline through the session before closing below 22,800.

According to him, 22,700 is the key support level. A break below it could take the index towards 22,400, while 23,000-23,100 remains the first important resistance zone.

For Tuesday, the market's direction will largely depend on crude oil prices, developments in the US-Iran conflict, foreign fund flows and global bond yields. The muted GIFT Nifty suggests a subdued start, but the recent downtrend means investors will closely watch whether the Nifty can hold above the 22,700 support zone.

- Ends