Opening Bell: Nifty reclaims 16000, Sensex up 700 points; Metal stocks outperform

Taking cues from its Asian peers, including SGX Nifty, the Indian market opened on a positive note on Friday. Snapping the two-day losing streak, the benchmarks opened higher by more than 1% on Friday. The broader Nifty50 crossed 16,000-mark, while the Sensex added over 700 points. The two indices opened at 16,043.80 and 53,513.97 repectively. 

In the broader market, Nifty midcap and smallcap gained nearly 2% as India VIX slipped below 23-mark.  

Among sectors, Metal, Auto and Banking outperformed as all other sectors started off in the green zone.

The excessive volatility in the market is broadly due to two reasons, said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"One, the market has discounted severe monetary tightening by the Fed which is likely to take the Fed funds rate to around 3% in 2023. Two, the market has not fully discounted the probability of the US economy slipping into recession in 2023. Till there is clarity on the second issue, the 'risk-off, risk-on mode' in the market is likely to continue in the near-term. It may take a few weeks for the markets to stabilize," said Vijaykumar

It is important to appreciate the fact that the dominant feature of this market is bearish in the short-term, he said.

"Nasdaq is 30% down from the peak and S&P 500 is 19%  down from the peak. These are reflections of weakness in the market. In India, FIIs are likely to continue selling since India is the only emerging market where they are sitting on good profits and the market provides the liquidity to sell," he added.

Meanwhile, In the pre-open, the Sensex opened over 350 points higher as 28 shares advanced, while HDFC Bank and Sun Pharma sat in the green.  

Earlier, in a positive sign for the Indian market, the SGX Nifty Futures rose more than 200 points or 1.3% on the Singaporean exchange around 8 am on Friday. Besides, Japanese Nikkei 225 gained over 1.1%, Hang Seng Index at the Hong Kong Exchange rose 1.5% and Chinese Shanghai Composite was trading higher by more than 0.7% in the early morning trade.  

The US market largely closed in the red on Thursday as all major indices declined on the closing basis. On Wall Street, Dow Jones declined 0.75%, Nasdaq ended lower by 0.26% and S&P 500 declined 0.58% in Thursday's closing