Indian markets remain under selling pressure

Indian equity markets remained under selling pressure during early afternoon deals, with both Sensex and Nifty trading below their respective neutral lines, as rising oil prices kept investors on edge after Iran reportedly struck 'hostile targets' in the Strait of Hormuz and said a deal with Oman to manage traffic through the waterway will not fully reopen the vital global trade route.

The Sensex traded under significant pressure, as selling intensified in select heavyweight blue-chip stocks. Worries about inflation, interest rates, rising crude oil prices and geopolitical tensions dampened sentiments.

The NSE Nifty also traded in negative territory, although it outperformed the Sensex during the early afternoon session, with support from select sectors helping offset weakness in heavyweight counters. 

On the global front, Asian markets were trading mixed, even after China's exports logged a strong double-digit growth in July and trade surplus exceeded expectations. The data from the customs office showed that exports advanced 23.9 percent on a yearly basis in July, faster than economists' forecast of 22.2 percent.

The BSE Sensex is currently trading at 78519.39, down by 435.37 points or 0.55% after trading in a range of 78430.05 and 78757.40. There were 13 stocks advancing against 17 stocks declining on the index.

The top gaining sectoral indices on the BSE were Auto up by 1.02%, IT up by 0.80%, Capital Goods up by 0.48%, Power up by 0.45% and TECK up by 0.41%, while Bankex down by 0.67%, Consumer Durables down by 0.56%, Oil & Gas down by 0.34%, Basic Materials down by 0.22% and Telecom down by 0.19% were the top losing indices on BSE.

The top gainers on the Sensex were TCS up by 2.59%, Mahindra & Mahindra up by 1.84%, Infosys up by 0.75%, HCL Technologies up by 0.58% and Interglobe Aviation up by 0.58%. On the flip side, Bajaj Finance down by 5.47%, Bajaj Finserv down by 4.37%, Trent down by 2.89%, ICICI Bank down by 2.73% and Kotak Mahindra Bank down by 1.14% were the top losers.

Meanwhile, despite higher input cost, Crisil Ratings has said that primary steel makers are likely to maintain operating profitability of Rs 10,500-11,000 per tonne in the current fiscal (FY27), supported by higher global steel prices and effect of the safeguard duty imposed last year. Favourable pricing, coupled with healthy demand growth, is expected to strengthen cash accruals and support capex requirements while sustaining stable credit profiles.

Amid higher coking coal prices and elevated logistics and energy costs, the cost of production for primary steel producers - producers of steel predominantly through BF-BOF (blast furnace-basic oxygen furnace) route is estimated to increase by around Rs 2,000 per tonne this fiscal, to Rs 53,000 - 54,000 per tonne. Crisil added that coking coal, which accounts for nearly 40% of production costs, is expected to become 5-7% costlier amid potential supply disruptions in key exporting regions and sustained demand from major steel producing countries. Besides, higher freight, shipping and insurance costs, along with elevated power and fuel expenses, will further add to cost pressures.

However, the rising cost pressures are expected to offset by higher steel prices, continued protection under the 11.5% safeguard duty and healthy domestic demand growth, keeping profitability steady. Crisil expects domestic steel prices to increase by 6-8% in this fiscal. It added that domestic steel demand is expected to remain healthy, growing 5-7% this fiscal on the high base of fiscal 2026, supported by sustained investments in infrastructure and robust demand from the automotive, engineering and construction sectors.

The CNX Nifty is currently trading at 24559.55, down by 76.45 points or 0.31% after trading in a range of 24529.20 and 24630.40. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were TCS up by 2.48%, Mahindra & Mahindra up by 2.13%, HCL Technologies up by 0.71%, Interglobe Aviation up by 0.71% and Infosys up by 0.65%. On the flip side, Bajaj Finance down by 5.18%, Bajaj Finserv down by 4.28%, Trent down by 2.74%, Shriram Finance down by 1.95% and ICICI Bank down by 1.44% were the top losers.

Asian markets were trading mixed; Hang Seng jumped 109.71 points or 0.43% to 25,639.99, Straits Times rose 49.78 points or 0.88% to 5,688.77, Jakarta Composite gained 44.77 points or 0.7% to 6,388.48 and Shanghai Composite was up by 39.68 points or 1.02% to 3,940.04, while Nikkei 225 slipped 76.55 points or 0.12% to 65,606.71, Taiwan Weighted lost 170.79 points or 0.39% to 44,225.91 and KOSPI fell 37.61 points or 0.60% to 6,258.77.