Domestic Indices Teeter as FPIs Sell, RBI Signals Rate Cut Possibility

Domestic stock markets opened flat with fluctuating indices as FPI selling and domestic buying struggle for dominance. Despite nearing all-time highs, markets remain range-bound due to strong resistance and external factors. An expected RBI rate cut in December aims to boost sentiment and rate-sensitive sectors.

On Tuesday, domestic stock markets opened flat with indices trapped between foreign portfolio investors' selling and domestic institutions' buying. Both the Nifty 50 and BSE Sensex attempted gains but failed to maintain momentum above their all-time highs, reflecting the ongoing market volatility.

Market experts highlighted that the benchmark indices remain range-bound, with Ajay Bagga, Banking and Market Expert, emphasizing liquidity challenges due to FPI selling and primary market activities. Despite 85% net short positions held by FPIs, the Rupee strengthened thanks to RBI's intervention, providing a modicum of stability.

The RBI Governor's statement hinting at a possible rate cut in December has instilled hope, particularly among rate-sensitive sectors like auto, realty, and finance. In contrast, technical analysts underscore persistent resistance, with Spot Nifty 50 repeatedly rejected at its multi-month trendline, necessitating a decisive breakout for any sustainable upward movement.

(With inputs from agencies.)