Sensex, Nifty trade flat with negative bias after positive start

Indian equity benchmarks opened at new highs on Thursday tracking overnight gains on Wall Street as traders reacted to the congressional testimony by US Fed Chair Jerome Powell, which raised the possibility of an interest rate cut in June. Powell said it will likely be appropriate for the Fed to begin lowering interest rates at “some point this year”, although he reiterated officials need “greater confidence” inflation is moving sustainably toward 2 percent. Soon, markets turned volatile and are hovering around neutral lines. At this point of trade, Sensex and Nifty are trading flat with negative bias as traders avoided to take any long position ahead of long weekend holiday as markets will remain close on Friday on account of Mahashivratri. 

Traders were concerned as Department for Promotion of Industry and Internal Trade data showed that foreign direct equity (FDI) investments contracted by 21 per cent Y-o-Y to $41.31 billion during the calendar year 2023. The sustained contraction in investment inflows comes against the backdrop of uncertainties and challenges in the global economy. This includes factors such as high inflation and slowdown in developed countries. However, losses remained capped amid foreign fund inflows. Foreign institutional investors (FIIs) net bought shares worth Rs 2,766.75 crore on March 6, provisional data from the NSE showed. 

On the global front, most of the Asian markets are trading lower amid speculation over a Bank of Japan pivot. China’s Shanghai Composite indexes fell as optimism over stronger-than-expected trade data was largely offset by the threat of new U.S. restrictions on Chinese companies. Back home, in stock specific development, NLC India fell as the government will sell its 7 per cent stake in the company via an OFS. On the other hand, IIFL Finance soared on liquidity support from Fairfax India Holdings.

The BSE Sensex is currently trading at 74063.46, down by 22.53 points or 0.03% after trading in a range of 73989.94 and 74245.17. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.40%, while Small cap index was up by 0.65%.

The top gaining sectoral indices on the BSE were Metal up by 2.07%, Basic Materials up by 1.29%, Industrials up by 0.71%, PSU up by 0.68% and Capital Goods up by 0.66%, while Auto down by 0.44%, Bankex down by 0.17%, TECK down by 0.09%, IT down by 0.08% and Consumer Durables down by 0.06% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 3.80%, JSW Steel up by 3.32%, Bajaj Finserv up by 2.19%, Bajaj Finance up by 2.12% and SBI up by 0.89%. On the flip side, Mahindra & Mahindra down by 3.20%, Axis Bank down by 0.89%, ICICI Bank down by 0.84%, Titan Company down by 0.66% and Reliance Industries down by 0.58% were the top losers.

Meanwhile, in the view of the third quarter (October-December) Gross Domestic Product (GDP) data released by the government, the Reserve Bank of India (RBI) Governor Shaktikanta Das has said the India’s economic growth could be close to 8 per cent in the current financial year (FY24). Recently, the National Statistical Office (NSO) projected 8.4 per cent growth in the October-December quarter of the FY24. It has also revised GDP estimates for the first and second quarters to 8.2 and 8.1 per cent from 7.8 per cent and 7.6 per cent, respectively.

Citing improvement in fiscal consolidation, current account deficit and price situation, Das said that overall the economy is doing very well. He noted that with high-frequency indicators and the momentum of the economy indicates that the Q4FY24 growth likely to exceed 5.9 per cent estimate and eventually, the full year growth might be more than 7.6 per cent and this will be good as numbers will be very close to 8 per cent. 

Regarding price rise, he said the latest inflation print of 5.1 per cent is still 110 basis points away from the target of 4 per cent. Though, he said the trend of inflation is on the decline and the RBI is now focused on taking inflation to the target of 4 per cent on a durable and sustainable basis.

The CNX Nifty is currently trading at 22455.55, down by 18.50 points or 0.08% after trading in a range of 22449.30 and 22523.65. There were 27 stocks advancing against 22 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Tata Steel up by 3.50%, JSW Steel up by 3.14%, UPL up by 2.21%, Bajaj Finserv up by 1.98% and Bajaj Finance up by 1.88%. On the flip side, Mahindra & Mahindra down by 3.44%, SBI Life Insurance down by 1.01%, ICICI Bank down by 0.86%, Axis Bank down by 0.79% and BPCL down by 0.76% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 slipped 391.58 points or 0.98% to 39,699.20, Hang Seng declined 77 points or 0.47% to 16,361.09, Straits Times fell 6.94 points or 0.22% to 3,129.20, Shanghai Composite weakened 4.89 points or 0.16% to 3,035.04, KOSPI was down by 0.43 points or 0.02% to 2,641.06. On the other hand, Taiwan Weighted surged 219.62 points or 1.13% to 19,719.07 and Jakarta Composite was up by 30.53 points or 0.42% to 7,360.33.