Indian equity futures signalled a steadier start to Thursday’s session as GIFT Nifty contracts traded near 22,650 in early trade, suggesting the Nifty 50 could attempt to reclaim the 22,700 zone after oil prices eased slightly from the prior day’s spike above $106 for Brent.
How Wednesday’s tape sets up Thursday
On Wednesday the Nifty settled at 22,622.70, down ninety-nine points or 0.44 percent, while the Sensex lost 252 points to close at 72,781.89. The pullback followed a sharp rally the previous session, when investors bet Finance Minister Nirmala Sitharaman’s comments at a bankers’ forum opened the door to a review of long-term capital gains tax and securities transaction tax. Profit booking combined with foreign portfolio investor sales kept the headline indices in the red even as information technology stocks outperformed.
India Today’s closing wrap noted Infosys and peers helped limit losses, a pattern Rohan Desai’s desk has watched all week: export-oriented IT earns in dollars while many domestic lenders and consumer names face higher funding costs after the RBI’s October rate hike.
Sector skew: IT versus oil
ONGC and other oil explorers remained a drag as crude stayed elevated on Strait of Hormuz disruption fears. Higher import bills feed into inflation forecasts the MPC cited when lifting the repo to 5.50 percent, which in turn pressures bank stocks through margin worries. Persistent Systems, a mid-cap IT name, bucked the weakness, continuing a trend where stock-specific earnings commentary matters more than index direction in a choppy October.
Broader market breadth has been mixed. Mid-cap indices have at times outperformed the Nifty 50 on days when liquidity squeezes hit large private banks hardest, reflecting how RBI balance-sheet operations ripple unevenly across the market cap spectrum.
Flows and levels traders cite
Foreign investors had stretched a selling streak through much of early October, while domestic institutions provided partial offset according to provisional NSE data cited in business-press reports. Dealers said resistance near 22,700 on the Nifty and 73,000 on the Sensex still matters for short-term positioning, with support clustered around 22,550 if crude reaccelerates.
For readers tracking Mumbai’s morning session, the immediate question is whether softer overnight oil and steady GIFT Nifty futures translate into follow-through buying in IT and selective defence exporters, or whether another wave of FPI sales keeps the index pinned below the psychological 22,700 handle through the Diwali-shortened week.
Earnings and macro cross-currents
Analysts this week flagged Tata Consultancy Services and Infosys management commentary on AI-linked deal pipelines as a reason export-oriented software could outperform domestic cyclicals while Brent remains above $100. At the same time, finance ministry officials have not confirmed any timeline for capital-markets tax tweaks, so the Tuesday rally that priced in reform may stay fragile until the winter session.
Currency traders are watching the RBI’s dedicated dollar window for state-run oil importers, a facility meant to reduce spot-market pressure on the rupee. When the rupee stabilises, portfolio managers often rotate back into financials; when oil jumps, the same stocks face immediate mark-to-market questions on treasury books.
Retail investors using systematic investment plans have continued to buy equity mutual funds through the volatility, according to industry association data cited in business newspapers, providing a floor under large-cap names even when foreign funds sell. That structural flow does not eliminate day-to-day swings, but it changes how traders think about support levels when global risk appetite wobbles.
Derivatives positioning
Put-call ratios on weekly Nifty options tightened after the October 7 repo hike, suggesting hedgers are paying up for downside protection without abandoning long equity exposures entirely. Open interest stacked near 22,500 and 22,800 strikes will influence how dealers manage gamma into the weekly expiry.
Single-stock futures in IT saw rising volumes as investors used them to express views without buying full-weight index futures tied to oil-heavy components. That micro positioning can keep the Nifty range-bound even when GIFT Nifty futures flash green before the open.