Pre-Market Report: Nifty, Sensex Slip Amid FII Selling, VIX Jumps 8%

Indian markets closed lower on Wednesday as foreign investors dumped shares worth ₹2,938 crore. The rupee crashed to a record low of ₹91.7 per dollar.

The Nifty dropped 0.30% to 25,157.50, while Sensex fell 0.33% to 81,909.63. Both briefly dipped further before recovering slightly at close.

Volatility spiked with the India VIX jumping to 8.25% as all eyes are on the upcoming bank earnings and Fed minutes from the US.

Yesterday's Market Recap

Despite experiencing significant intraday fluctuations, benchmarks were unable to maintain recovery efforts. The Nifty dipped below 25,000 during the session but bounced back by close, showing buyers stepped in at key support levels.

Broader markets also saw heavier pressure:

• Midcap Nifty: ~ -1.15%
• Nifty Smallcap 100: ~ -0.90%

Banking and financial stocks led the selloff, joined by declines in consumer durables, as investors turned cautious ahead of key bank earnings. In contrast, selective buying was seen in metal, oil and gas stocks.

Global Markets: What Do They Signal?

Global sentiment turned risk-averse after fresh concerns over a potential escalation in US–EU trade tensions linked to the Greenland issue. The United States has threatened to impose tariffs starting at 10% from February, which could rise to 25% by June if negotiations stall, raising fears of a broader trade conflict among major economies.

Japan’s Nikkei slipped 0.41% to 52,774, while Hong Kong’s Hang Seng gained 0.37% to 26,585, offering limited relief amid weak regional sentiment.

In US markets,

• Dow Jones: +0.48%
• S&P 500: +0.32%
• Nasdaq: +0.13%

Technical Levels

The Nifty's RSI has fallen below 30, signalling oversold conditions after days of heavy selling. The index has support at 24,808 and 24,596, with resistance at 25,494 and 25,707.

Despite oversold conditions in several stocks, buyers remain cautious as investors wait for foreign fund flows to stabilise and global uncertainties to ease before taking fresh positions.

What to Expect in Today's Market?

Markets are expected to remain choppy in the near term as volatility stays elevated and foreign investors continue their selling pressure. Sentiment is also being weighed down by uncertain global cues, which are keeping traders cautious.

As a result, market activity is likely to be more stock-specific rather than driven by broad-based trends. Investors need to closely track quarterly earnings for company-level triggers, while global economic developments, currency movements, and crude oil prices will play a key role in shaping overall market direction.

Sources:

(Mint)
(Google Finance)