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India's benchmark indexes are poised to open higher on Friday, following gains in the previous three sessions, as expectations rise for potential positive triggers from the upcoming union budget.

The GIFT Nifty futures were trading at 23,436, as of 8:17 a.m. IST, indicating that the blue-chip NSE Nifty 50 will open above Thursday's close of 23,249.5.

Both benchmark indexes - the Nifty 50 and the BSE Sensex - gained 1.8% each in the last three sessions, halting a slide that saw them drop to seven-month lows.

Markets await the outcome of the annual budget, scheduled for Feb. 1, for key directional triggers. India's equity markets will remain open on that day.

A host of factors like the current domestic economic slowdown, relentless foreign outflows from markets and uncertainty over U.S. trade policy makes this budget a crucial one for the markets, said Amar Deo Singh, vice president of research at Angel One.

Financials, supported by the Reserve Bank of India's measures to inject liquidity in the banking system, gained 3.4% over the last three sessions. Meanwhile, interest rate-sensitive realty surged 7% during the same period, fuelled by rising expectations of a rate cut.

Despite the recent climb, India's Nifty 50 and Sensex are still down about 11% each from their record highs hit on Sept. 27, 2024. Both are down 1.7% in January, on track for the longest monthly losing streak in 23 years.

Elevated U.S. Treasury yields and lacklustre domestic earnings have led to foreign outflows from Indian stocks worth $8.8 billion in January alone, set for the second-highest monthly FPI outflows on record.

Asian markets were subdued on the day, while Wall Street equities rose overnight, helped by positive updates from Meta and Tesla. [MKTS/GLOB]

Data on Thursday showed U.S. economic growth slowed in the December quarter, but remained robust enough for investors to expect the Federal Reserve to lower rates only gradually this year.

STOCKS TO WATCH

** Larsen & Toubro posts Q3 profit miss, but new orders jump to record high

** Tata Consumer Products misses December-quarter profit estimates on higher tea prices

** Bank of Baroda posts rise in December quarter profit

($1 = 86.6350 Indian rupees)