GIFT Nifty is a stock market index derivative traded on the international exchange in GIFT City (Gujarat International Finance Tec-City), India. It replaced the earlier SGX Nifty, which used to trade on the Singapore Exchange.
Key points:
- GIFT Nifty tracks the Nifty 50 Index of India.
- It is traded on the NSE International Exchange in GIFT City.
- Trading hours are much longer than the regular Indian stock market, allowing investors to react to global events before Indian markets open.
- Traders and investors use it as an indicator of how the Indian market may open the next day or the next morning.
Why is GIFT Nifty important?
If GIFT Nifty is:
- Up before the Indian market opens → suggests a positive opening for the NIFTY 50.
- Down before the Indian market opens → suggests a negative opening.
Example
Suppose Nifty 50 closed at 25,000 yesterday:
- If GIFT Nifty is trading around 25,150 before market open, traders may expect the Indian market to open higher.
- If it is trading around 24,850, they may expect a lower opening.
Difference between SGX Nifty and GIFT Nifty
| SGX Nifty | GIFT Nifty |
|---|---|
| Traded in Singapore | Traded in GIFT City, India |
| On Singapore Exchange | On NSE International Exchange |
| Discontinued in 2023 | Current international Nifty derivative |
In short, GIFT Nifty is the international futures contract based on Nifty 50 and is widely watched as an early indicator of Indian market sentiment.