Indian stocks set for mildly positive open; FPI selling remains heavy

GIFT Nifty:

GIFT Nifty October 2026 futures rose 19 points, indicating a mildly positive opening for the Nifty 50.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 9,484.22 crore, while domestic institutional investors (DIIs) were net buyers of Rs 10,041.84 crore in the Indian equity market on 1 October 2026, according to provisional data.

FPIs sold shares worth Rs 9,569.57 crore in October through 1 October 2026. This follows net selling of Rs 45,536.89 crore in September 2026, while FPIs were net buyers of Rs 17,366 crore in August 2026.

Global Markets:

Most Asian indices traded higher on Monday, even as investor sentiment remained cautious amid elevated crude oil prices and high US Treasury yields. Markets in mainland China and South Korea remained closed for holidays.

Softer-than-expected US jobs data eased expectations of an interest rate hike by the US Federal Reserve at its October meeting. However, investors remained cautious as the US 10-year Treasury yield had climbed to 5.34% last week, its highest level since 2002. Elevated yields increase borrowing costs and can weigh on equity valuations, even if the Fed keeps its policy rate unchanged in the near term.

Meanwhile, crude oil prices remained elevated. Brent crude was trading around $102.20 a barrel on Monday morning after briefly moving above $103, as Saudi-backed Yemeni forces launched a campaign to reclaim Houthi-controlled areas. Continued geopolitical tensions in the Middle East kept concerns over oil supply elevated.

US stocks ended higher on Friday after weaker-than-expected jobs data reduced expectations of a Federal Reserve rate hike at its policy meeting later this month. The Dow Jones Industrial Average rose 250.40 points, or 0.49%, to 51,176.96, while the S&P 500 gained 56.27 points, or 0.73%, to 7,722.72. The Nasdaq Composite advanced 319.27 points, or 1.19%, to 27,190.86. US nonfarm payroll employment increased by just 29,000 in September, well below economists' expectations of 90,000. The unemployment rate rose to 4.2% from 4.1% in August. Payroll gains for July and August were also revised lower by a combined 60,000.

The weaker-than-expected jobs data sharply reduced expectations of a 25-basis-point Fed rate hike at the end of October. CME FedWatch put the probability of a hike at 22.7%, down from 24.4% in the previous session and 64.2% a week earlier.

Domestic Market:

The key equity benchmarks ended sharply lower on 1 October 2026, extending their decline for the fourth consecutive session. Intensified foreign institutional investor (FII) selling, rising US bond yields and a weakening rupee weighed on investor sentiment. The sentiment remained subdued amid elevated crude oil prices and continued uncertainty surrounding the US-Iran conflict. The Nifty settled below the 22,450 level, while broader markets also declined. Auto and metal stocks fell, while IT shares bucked the weak market trend.

The Sensex declined 570.59 points or 0.79% to 71,909.70. The Nifty 50 index tumbled 198.50 points or 0.88% to 22,421.95. In the four consecutive trading sessions, the Sensex and Nifty declined 2.69% and 3.11%, respectively.

The Indian stock market was closed on 2 October 2026, on account of Mahatma Gandhi Jayanti.

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