Markets continue to trade flat in morning deals

Indian equity benchmarks continue to trade flat in morning deals amid weak trend in global markets and fresh foreign fund outflows. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 1,047.19 crore on Tuesday after a day's breather, according to exchange data. Also, high valuation concerns of the domestic market made investors cautious. However, traders took some support with data showing an ease in retail inflation and a rise in industrial output. Hitting 5-month high, India’s industrial production measured in Index of Industrial Production (IIP) jumped to 5.7 per cent in July 2023 from 3.7 per cent in June 2023. Besides, after touching a 15-month high of 7.44 per cent in July 2023, retail inflation based on the Consumer Price Index (CPI) declined to 6.83 per cent in August 2023 mainly due to softening prices of vegetables. Some support also came as SBI research in its latest report ‘Towards a Payroll Reporting in India’ stating that the economy has added around 5.2 crore new formal jobs between FY20 and FY23, with the net addition being 2.7 crore, citing the payroll data of the Employees’ Provident Fund Organisation (EPFO), the National Pension Scheme (NPS) and Employees State Insurance Corporation (ESIC). On the global front, Asian markets are trading mostly lower as investors awaited the release of U.S. inflation data later in the day that could influence the Federal Reserve's policy path.

The BSE Sensex is currently trading at 67210.28, down by 10.85 points or 0.02% after trading in a range of 67053.36 and 67296.97. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.99%, while Small cap index was down by 0.81%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.48%, Energy up by 0.44%, FMCG up by 0.30% and Healthcare up by 0.06%, while Realty down by 1.57%, Industrials down by 1.11%, Capital Goods down by 0.96%, Power down by 0.79% and Auto down by 0.52% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 1.33%, ITC up by 1.11%, Bharti Airtel up by 0.83%, Tata Motors up by 0.81% and Nestle up by 0.59%. On the flip side, Bajaj Finserv down by 1.48%, Mahindra & Mahindra down by 1.09%, HCL Technologies down by 0.81%, Asian Paints down by 0.77% and ICICI Bank down by 0.76% were the top losers.

Meanwhile, after touching a 15-month high of 7.44 per cent in July 2023, retail inflation based on the Consumer Price Index (CPI) declined to 6.83 per cent in August 2023 mainly due to softening prices of vegetables. CPI was at 7 per cent in August 2022. But, still the inflation remains above the comfort level of the Reserve Bank of India (RBI), which has the mandate to ensure inflation remains at 4 per cent with a margin of 2 per cent on either side.

The overall inflation in the food basket stood at 9.94 per cent in August as against 11.51 per cent in July. The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that Rural CPI (General) in August 2023 stood at 7.02 per cent as against 7.63 per cent in July. The Urban CPI (General) stood at 6.59 per cent in August as against 7.20 per cent in July. The index value for Rural, Urban and Combined CPI (General) stood at 187.6, 184.5 and 186.2 respectively, in August 2023.

Inflation in the vegetable basket eased to 26.14 per cent in August as against 37.4 per cent in July. The prices of 'oil and fats' products declined to 15.28 per cent in August while there was low inflation in 'meat and fish', 'eggs', 'sugar and confectionary', 'non-alcoholic beverages', 'fruits' and 'prepared meals and snacks' on an annual basis. The data also showed that inflation in the 'housing' was at 4.38 per cent and 'fuel and light' at 4.31 per cent.

The CNX Nifty is currently trading at 19987.20, down by 6.00 points or 0.03% after trading in a range of 19944.10 and 20021.95. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Power Grid Corporation up by 1.33%, BPCL up by 1.26%, ITC up by 1.09%, Grasim Industries up by 1.04% and Britannia Industries up by 1.02%. On the flip side, HDFC Life Insurance down by 2.37%, Bajaj Finserv down by 1.38%, Mahindra & Mahindra down by 1.27%, SBI Life Insurance down by 1.20% and Adani Ports &SEZ down by 0.99% were the top losers.

Asian markets are trading mostly lower; Hang Seng declined 37.86 points or 0.21% to 17,988.03, Taiwan Weighted lost 2.39 points or 0.01% to 16,570.32, Straits Times fell 1.91 points or 0.06% to 3,212.55, Shanghai Composite weakened 27.18 points or 0.87% to 3,109.88 and Jakarta Composite plunged 16.97 points or 0.24% to 6,917.00.

On the flip side, KOSPI increased 1.37 points or 0.05% to 2,537.95 and Nikkei 225 surged 9 points or 0.03% to 32,785.37.