Markets struggle for direction in early deals ahead of RBI’s rate decision

Indian equity benchmarks made flat-to-negative start on Wednesday and soon turned volatile as investors awaited the Reserve Bank of India's Monetary Policy Committee decision. The Reserve Bank of India's Monetary Policy Committee will announce its decision for the August meeting later today, against the backdrop of surging global trade tensions, cooling inflation, and currency pressures. Markets are trading flat with negative bias in early deals. Traders were concerned as the U.S. President Donald Trump has reiterated his decision to impose a ‘substantial’ increase in tariffs on Indian imports within 24 hours, accusing India of taking advantage of the Russia-Ukraine conflict by reselling Russian oil for profit. However, down side remained capped as Business Expectations Survey of National Council of Applied Economic Research (NCAER) report showed that the Business Confidence Index (BCI) rose sharply to 149.4 in the April-June period from 139.3 in the last quarter of 2024-25.

On the global front, Asian markets are trading mixed, following the broadly negative cues from Wall Street overnight, amid the ongoing trade concerns following US President Donald Trump's latest comments on tariffs. Trump said he will be announcing new tariffs on semiconductors and chips as well as up to 250 percent on pharmaceuticals imported into the U.S. Back home, pharma stocks are in focus as U.S. President Donald Trump announced that he would levy imports on pharmaceutical products soon, with tariffs ranging up to 250 percent.

The BSE Sensex is currently trading at 80664.51, down by 45.74 points or 0.06% after trading in a range of 80634.73 and 80834.43. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.61%, while Small cap index was down by 0.79%.

The only gaining sectoral index on the BSE was Bankex up by 0.18%, while Healthcare down by 1.15%, IT down by 0.93%, Realty down by 0.85%, Capital Goods down by 0.84% and Consumer Durables down by 0.58% were the top losing indices on BSE.

The top gainers on the Sensex were Adani Ports & SEZ up by 1.53%, Bharti Airtel up by 0.82%, Trent up by 0.67%, Kotak Mahindra Bank up by 0.66% and Ultratech Cement up by 0.56%. On the flip side, HCL Technologies down by 1.18%, Sun Pharma down by 1.13%, Infosys down by 1.08%, Eternal down by 1.01% and Tech Mahindra down by 0.82% were the top losers.

Meanwhile, the National Council of Applied Economic Research (NCAER) in its Business Expectations Survey has showed that the Business Confidence Index (BCI) rose sharply to 149.4 in the April-June period of 2025-26 from 139.3 in the last quarter of 2024-25. It said the BCI is based on four components -- overall economic conditions to improve in next six months, financial position of firms will improve in the next six months, present investment climate and whether present capacity utilisation was close to or above optimal level. The share of positive responses across the four components remains above 60 per cent in the first quarter and also each component exhibited improving trend compared to the preceding quarter.

Majority of respondents expected production (78.7 per cent) and domestic sales (79.1 per cent) to increase in the next six months. It said sentiments about export of final products also improved (66.5 per cent) in the first quarter of the current fiscal year. It added percentage of firms expecting import of raw materials to rise also increased (54.3 per cent) from the preceding quarter (46.1 per cent), signalling a push in domestic production activities. Regarding sentiments about pre-tax profits, nearly 61 per cent of firms expected them to rise, indicating continued buoyancy.

However, it said buoyancy in business sentiments was not reflected in the labour markets that showed signs of stagnation with both sentiments about hiring and expectations of wage rates remaining unchanged over the next six months. The Business Expectations quarterly survey was carried out in June, covering 479 companies spread across six cities.

The CNX Nifty is currently trading at 24621.05, down by 28.50 points or 0.12% after trading in a range of 24616.15 and 24671.40. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Adani Ports & SEZ up by 1.45%, Bharti Airtel up by 0.90%, Trent up by 0.88%, HDFC Life Insurance up by 0.74% and SBI Life Insurance up by 0.72%. On the flip side, Dr. Reddy's Lab down by 1.33%, HCL Technologies down by 1.23%, Coal India down by 1.23%, Wipro down by 1.20% and Sun Pharma down by 1.17% were the top losers.

Asian markets are trading mixed; Taiwan Weighted lost 188.95 points or 0.8 to 23,471.64, Hang Seng declined 38.53 points or 0.15 to 24,864.00, KOSPI dropped 7.00 points or 0.22 to 3,191.00 and Straits Times fell 3.34 points or 0.08 to 4,205.24. On the other hand, Nikkei 225 surged 274.46 points or 0.68 to 40,824.00, Jakarta Composite gained 19.1 points or 0.25 to 7,534.29 and Shanghai Composite was up by 9.94 points or 0.27 to 3,627.54.