Domestic indices trade flat with positive bias in early deals

Indian equity benchmarks made cautious start on Wednesday amid broadly negative cues from Wall Street overnight as well as weakness in Asian counterparts, amid concerns about global economic slowdown after release of disappointing data that showed weak services activity in China and slowing eurozone business activity. Soon markets tuned volatile but managed to eke out slender gains and are trading higher with marginal gains in early deals. Some optimism came in as the RBI Deputy Governor said India was in a sweet spot to grow robustly, despite global turmoil and monsoon risks to growth, and to do so, developing credit markets was essential. Traders also took note of RBI Governor Shaktikanta Das’ statement that the Reserve Bank of India (RBI) is determined to bringing down inflation to 4 per cent and will remain watchful of risks as more frequent global supply shocks can have profound implications on the management of the price situation. 

However, upside remained limited amid foreign fund outflows. Provisional data from the National Stock Exchange (NSE) showed foreign institutional investors (FII) sold shares worth Rs 1,725.11 crore on September 5. On the sectoral front, oil & gas sector stocks are in focus as crude oil prices hit a 9-month high overnight on expectations of additional supply cuts by major oil producers like Saudi Arabia and Russia. In stock specific development, Jio Financial Services will be removed from the NSE Indices, including the Nifty50, from September 7, as the stock has not hit the price band on two consecutive trading days on September 4 and September 5 on the NSE.

The BSE Sensex is currently trading at 65853.58, up by 73.32 points or 0.11% after trading in a range of 65734.60 and 65870.70. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.11%, while Small cap index was up by 0.31%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.72%, Energy up by 0.71%, Telecom up by 0.48%, FMCG up by 0.35% and Healthcare up by 0.32%, while Metal down by 0.90%, Realty down by 0.27%, Power down by 0.18%, PSU down by 0.16% and Auto down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 0.88%, HDFC Bank up by 0.65%, Wipro up by 0.56%, ITC up by 0.55% and Ultratech Cement up by 0.48%. On the flip side, Indusind Bank down by 1.02%, Tata Steel down by 0.68%, NTPC down by 0.64%, JSW Steel down by 0.56% and Asian Paints down by 0.42% were the top losers.

Meanwhile, expressing optimism over India’s inflation scenario, the Reserve Bank of India (RBI) Governor Shaktikanta Das has said the central bank is committed to bringing down inflation to 4 per cent and will remain watchful of risks as more frequent global supply shocks can have profound implications on the management of the price situation.

He said the RBI remains on guard to ensure that the second-order effects in the form of generalisation and persistence with regard to inflation are not allowed to take hold. The central bank has been mandated by the government to keep inflation at 4 per cent with a margin of 2 per cent on either side.

He said ‘the frequent incidences of recurring food price shocks pose a risk to the anchoring of inflation expectations, which has been underway since February 2022. We will remain watchful of this aspect also. The role of continued and timely supply side interventions as is being undertaken by the government assumes criticality in limiting the severity and duration of such food price shocks’.

In these circumstances, he said it is necessary to be watchful of any risk to price stability and act timely and appropriately. Without giving any timeframe, he said ‘we remained firmly focused on aligning inflation to the target of 4 per cent’. He also said that inflation, which had touched a high of 7.4 per cent in July, driven by a rise in vegetable prices, has started moderating.

The CNX Nifty is currently trading at 19592.60, up by 17.70 points or 0.09% after trading in a range of 19562.15 and 19604.85. There were 23 stocks advancing against 27 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Cipla up by 1.92%, SBI Life Insurance up by 1.39%, HDFC Life Insurance up by 1.08%, Bharti Airtel up by 1.05% and ONGC up by 0.93%. On the flip side, JIO Financial Services down by 2.51%, Hindalco down by 1.70%, Indusind Bank down by 1.24%, Tata Steel down by 0.84% and NTPC down by 0.79% were the top losers.

Asian markets are trading mostly in red; Hang Seng declined 148.21 points or 0.81% to 18,308.70, Taiwan Weighted lost 22.11 points or 0.13% to 16,769.50, KOSPI dropped 17.96 points or 0.7% to 2,564.22, Shanghai Composite weakened 10.75 points or 0.34% to 3,143.62 and Straits Times fell 4.8 points or 0.15% to 3,222.03. On the other hand, Nikkei 225 surged 229.29 points or 0.69% to 33,266.05 and Jakarta Composite was up by 6.75 points or 0.1% to 6,998.46.