Indian markets trade flat with negative bias ahead of macroeconomic data

Indian equity benchmarks opened marginally in red on Friday amid mixed global cues. Markets extended their losses but soon recovered to trade flat with negative bias in early deals. Domestic indices struggling for direction ahead of macroeconomic data, Index of Industrial Production (IIP) and Consumer Price Index (CPI), which will be released after market hours today. There are expectations that headline retail inflation is likely to have cooled in July, led by lower food prices, with prices of certain key items posting a sequential fall. Also, investors remained on sidelines as Dalal Street heads into a long weekend on account of the Independence Day holiday on Monday. Though, downside remained limited with a private report that India will be the fastest growing major economy this year and the next despite headwinds from rising inflation, widening trade deficit and a declining rupee. It added that the 7 per cent decline in rupee value against the US dollar this year was not worrisome, and the government and RBI are confident of managing the situation. Also, S&P Global Ratings said the Indian economy can handle some erosion of its foreign exchange reserves as its external position is very strong.

On the global front, Asian markets are trading mixed, following the mixed cues from Wall Street overnight, as traders reacted to another US Labor Department report showing an unexpected decrease in producer prices in the month of July, raising hopes that inflation in the US may have peaked, which could allow the Fed to slow the pace of interest rate increases. Back home, the oil ministry has ordered the diversion of natural gas from industries to the city gas distribution sector to cool CNG and piped cooking gas prices that have shot up by 70 per cent on the use of imported fuel. In stock specific development, Oil India climbed after the state explorer tripled its net profit to Rs 1,555.4 crore in Q1FY23.

The BSE Sensex is currently trading at 59246.94, down by 85.66 points or 0.14% after trading in a range of 59113.01 and 59345.70. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index added 0.06%, while Small cap index was up by 0.30%.

The top gaining sectoral indices on the BSE were Metal up by 1.94%, Oil & Gas up by 1.47%, Energy up by 1.27%, Realty up by 1.11%, PSU up by 0.89%, while Healthcare down by 1.13%, FMCG down by 0.52%, TECK down by 0.44%, Auto down by 0.42%, IT down by 0.42% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.57%, NTPC up by 1.50%, Power Grid up by 1.35%, Reliance Industries up by 0.76% and SBI up by 0.62%. On the flip side, Maruti Suzuki down by 1.48%, Nestle down by 1.29%, Sun Pharma down by 1.23%, Ultratech Cement down by 1.07% and Tech Mahindra down by 0.88% were the top losers.

Meanwhile, after concluding the fifth round of talks for the agreement on July 29, India and the UK will continue to work intensively to conclude the majority of talks on a comprehensive and balanced Free Trade Agreement (FTA) by end of October 2022. In a joint statement on the ongoing FTA negotiations, the Department for International Trade (DIT) said the fifth round involved a detailed draft treaty text discussion over 85 separate sessions and 15 policy areas. The latest round concluded, with the next due to be held in the UK later this month.

It said negotiation officials undertook these technical talks in a hybrid fashion with some of the teams meeting in New Delhi and the majority of officials joining virtually. For this round of negotiations, technical experts from both sides came together for detailed draft treaty text discussions in 85 separate sessions covering 15 policy areas. The statement follows Commerce and Industry Minister Piyush Goyal's statement earlier this week that negotiations for the India-UK FTA are moving at a faster pace.

Recently, The House of Commons International Agreements Committee, in a report entitled UK-India free trade agreement: Scrutiny of the Government's Negotiating Objectives', questioned the Diwali deadline set for the conclusion of the negotiations by Johnson during his visit to India in April. The committee cautioned that could risk giving up a good deal for a fast one, by setting a time ambition over and above content. The committee has called on the government to publish a comprehensive trade policy that provides a framework within which all negotiations can be conducted.

The CNX Nifty is currently trading at 17637.95, down by 21.05 points or 0.12% after trading in a range of 17597.85 and 17661.15. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 2.80%, Hindalco up by 1.89%, ONGC up by 1.81%, JSW Steel up by 1.54% and NTPC up by 1.37%. On the flip side, Apollo Hospital down by 2.44%, Divi's Lab down by 2.41%, Sun Pharma down by 1.35%, Maruti Suzuki down by 1.18% and Ultratech Cement down by 1.12% were the top losers.

Asian markets are trading mixed; Nikkei 225 surged 684.52 points or 2.46% to 28,503.85, Hang Seng added 45.41 points or 0.23% to 20,127.84, Taiwan Weighted rose 64.68 points or 0.43% to 15,262.53 and KOSPI was up by 3.51 points or 0.14% to 2,527.29. On the other hand, Straits Times declined 31.55 points or 0.96% to 3,270.41, Jakarta Composite fell 13.17 points or 0.18% to 7,147.22 and Shanghai Composite was down by 5.14 points or 0.16% to 3,276.53.