Pre-Market Update: GIFT Nifty Signals 90 Points Gap Up Start as Global Rally Supports Sentiment

Pre-Market Update at 7:40 AM: Indian equities are likely to open on a positive note on Friday, September 4, with GIFT Nifty signalling early gains. GIFT Nifty was trading near 24,023, around 90 points above the Nifty 50's previous close. The move points to a potential gap-up opening for domestic equities, supported by strong overnight gains in U.S. markets and easing concerns over global bond yields.

However, elevated crude oil prices and continued geopolitical tensions remain key factors that could limit aggressive buying during the session.

U.S. markets recorded a strong recovery in the previous session, with all major indices ending higher. The Dow Jones Industrial Average gained 1.18 per cent to 53,686.11, the S&P 500 advanced 1.06 per cent to 7,747.71, while the Nasdaq Composite climbed 1.40 per cent to 26,584.06.

The rally was supported by a decline in U.S. Treasury yields after comments from Federal Reserve Governor Christopher Waller reduced concerns over further monetary tightening. Technology stocks led the gains, supported by renewed investor interest in artificial intelligence-related companies.

Asian markets opened with mixed signals, with the Nikkei 225, Hang Seng, Shanghai Composite and Kospi influenced by overnight gains on Wall Street, currency movements and regional economic concerns. In the previous session, the Nikkei closed at 64,214.48, the Hang Seng at 25,213.31, the Shanghai Composite at 3,942.09 and the Kospi at 6,579.48.

European markets also ended higher in the previous session. The FTSE 100 gained 0.70 per cent, Germany's DAX rose 0.63 per cent and France's CAC 40 advanced 0.07 per cent. Global sentiment improved as lower bond yields provided support to risk assets.

The direction of interest rates remains the major global market trigger. Investors are closely tracking upcoming U.S. economic data for confirmation of the Federal Reserve's policy path. Lower yields have supported equities, while persistent inflation concerns remain a key risk.

Oil prices headed for their biggest weekly gain since July on Friday, September 4, as renewed hostilities between the U.S. and Iran raised fears of prolonged disruption to energy flows through the Strait of Hormuz.

Brent crude edged towards USD 96 a barrel, having climbed more than 7 per cent over the week, while West Texas Intermediate traded near USD 92 a barrel. Benchmark Brent crude had earlier been changing hands around USD 95 a barrel during Intraday trade.

The surge came after a period of relative calm was shattered by fresh fighting. The U.S. carried out a bombing campaign earlier in the week, which Iran answered with retaliatory strikes on American bases in the region. The renewed tensions have heightened concerns over potential disruptions to global energy supplies and could remain a key risk for oil-importing economies such as India.

Gold benefited from softer bond yields and a weaker dollar, with international gold prices gaining during the previous session. Silver also remained firm amid expectations of reduced interest-rate pressure.

The U.S. Dollar Index weakened as Treasury yields declined. The 10-year U.S. Treasury yield moved lower towards the 4.76 per cent zone, reducing pressure on global equity markets and providing some relief to emerging-market assets.

The Indian rupee remains sensitive to crude oil prices, foreign fund flows and movements in the dollar. A stronger dollar or a continued rise in crude prices could limit near-term appreciation in the domestic currency.

Indian equities ended lower in the previous session despite recovering from intraday lows. The Nifty 50 closed at 23,873.45, declining 41 points, or 0.17 per cent, after moving between an intraday high of 24,025.40 and a low of 23,786.80. The Sensex closed at 76,152.86, declining 0.55 per cent.

Foreign institutional investors remained net sellers, while domestic institutional investors provided support. FIIs sold equities worth Rs 2,345.87 crore, whereas DIIs recorded net buying of Rs 4,977.46 crore on September 3.

Bank Nifty continues to show relative strength compared with the broader market. The index may find support near recent swing lows, while resistance remains around previous consolidation levels.

India VIX remained subdued compared with historical averages, indicating that markets are not pricing in extreme volatility despite ongoing global risks.

U.S. equities rallied as easing Treasury yields supported technology stocks and improved global risk appetite. The development could remain positive for IT and technology-linked sectors.

Recent NSE regulatory developments also remain in focus. The Supreme Court's disposal of the NSE-SEBI settlement-related matter removed a regulatory hurdle linked to NSE's future plans, which could be neutral to positive for market infrastructure sentiment.

Foreign fund selling remains a near-term headwind for Indian equities, although sustained domestic institutional buying is providing some cushion.

Global interest-rate expectations remain central to market direction, with investors closely watching upcoming U.S. economic data for signals regarding future Federal Reserve action.

Gland Pharma remains in focus following recent developments around its business outlook and broader movements in the pharmaceutical sector.

Rail Vikas Nigam (RVNL) remains on the radar amid infrastructure-related announcements and developments in the Railway sector.

Cipla remains in focus following sector-specific developments and continued investor interest in defensive pharmaceutical stocks.

Avalon Technologies is among the stocks being tracked following recent business updates in the electronics manufacturing segment.

Ramco Systems remains under focus amid developments in the IT services space.

Sterlite Technologies remains in focus due to developments around telecom infrastructure demand.

RBL Bank remains on the radar as banking-sector movements and institutional activity continue to influence the stock.

India's economy recorded strong growth in Q1 FY27, although some sectors continued to face challenges. Agriculture-sector growth moderated to 3.6 per cent in Q1 FY27 from 4.4 per cent in Q1 FY26.

The mining and quarrying sector slipped into a contraction of 2.4 per cent in Q1 FY27, partly due to a high base of 12.4 per cent growth in the corresponding quarter of the previous year.

Overall, domestic market sentiment is likely to benefit from positive global cues and the strong opening indication from GIFT Nifty. However, elevated crude oil prices, geopolitical risks, foreign fund outflows and upcoming U.S. economic data could keep volatility elevated. Traders will closely watch the Nifty 50's ability to reclaim the 24,000 level and sustain gains above key resistance zones.

Disclaimer: The article is for informational purposes only and not investment advice.

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