Indian equity benchmarks made a pessimistic start on Wednesday tracking weakness in Asian counterparts and rise in global crude oil prices amid concerns over a developing Gulf of Mexico storm and renewed supply risks in West Asia. Investors also avoided risky bids ahead of the outcome of the Reserve Bank of India’s (RBI) Monetary Policy Committee (MPC) meeting. MPC is likely to raise benchmark interest rate by at least 25 basis points as inflationary pressures build and global central banks turn more hawkish.
Sensex and Nifty were trading lower with divergent trends in early deals. Nifty unperformed Sensex with cut of over 0.72%, while Sensex lost over 0.59%. Some concern as foreign institutional investors (FIIs) continued their selling spree, offloading equities worth Rs 2,961.30 crore on Tuesday.
On the global front, Asian markets were trading lower, even though US stocks touched new highs, as oil prices rose with a storm heading for the Gulf of Mexico and tensions escalating between Saudi Arabia and Yemen's Iran-backed Houthis. Meanwhile, Mainland Chinese market remain closed for the Golden Week holiday.
The BSE Sensex is currently trading at 72634.71, down by 433.10 points or 0.59% after trading in a range of 72539.18 and 72969.57. There were 4 stocks advancing against 26 stocks declining on the index.
The only gaining sectoral indices on the BSE were Telecom up by 0.57% and TECK up by 0.01%, while Consumer Durables down by 1.72%, Metal down by 1.23%, Basic Materials down by 0.86%, Auto down by 0.86% and Realty down by 0.73% were the top losing indices on BSE.
The top gainers on the Sensex were Bajaj Finance up by 1.17%, Bharti Airtel up by 0.94%, Eternal up by 0.46% and Interglobe Aviation up by 0.38%. On the flip side, Titan Company down by 3.85%, Bharat Electronics down by 1.69%, Asian Paints down by 1.39%, Ultratech Cement down by 1.08% and Axis Bank down by 1.08% were the top losers.
Meanwhile, the Federation of Indian Chambers of Commerce & Industry (FICCI) in its latest edition of Manufacturing Survey has said that India's manufacturing sentiment improved in the July-September quarter of fiscal year 2026-27 (Q2FY27) as factories reported higher capacity utilisation and higher or same levels of production as compared to the previous quarter. The survey, which covered around 225 firms, assessed the performance and sentiment of manufacturers for nine major sectors -- namely automotive & auto components, capital goods, chemicals and allied products, electronics & electricals, glass, machine tools, metal & metal products, textiles, apparels & technical textiles and miscellaneous. The survey covered respondents from manufacturing units from both large and SME segments with a combined annual turnover of over Rs 2 lakh crore.
According to FICCI, the findings reflect a rebound in the sentiment for production in Q2 2026-27 compared to the previous quarter, indicating signs of recovery from the West Asia crisis. In comparison to Q1 FY 2026-27, when 77 per cent of respondents reported higher or same production levels, around 95 per cent of respondents reported either higher or same production levels for Q2. This positive outlook was also evident in demand, as 90 per cent of respondents reported higher or same orders in Q2 FY 2027 as compared to 77 per cent in the previous quarter. It added that a positive impact was seen on the capacity utilisation vis-a-vis the previous quarter. The existing average capacity utilisation in manufacturing was close to 75 per cent, which is higher than 72 per cent in the previous quarter.
The survey said the investment outlook is steady for the next six months. Challenges faced by respondents in expanding capacities include uncertainty due to current geopolitical situation (tariffs, trade restrictions, demand uncertainty), and operational issues (skill/labour availability, raw material shortages, increasing logistic costs, regulatory challenges). In Q2 2026-27, around 89 per cent of the respondents reported higher or same level of inventory and for Q1, around 91 per cent of the respondents reported higher or same level of inventory.
Regarding exports, about 74 per cent of respondents reported higher or same level of exports in Q1 FY 2026-27 and in Q2, around 80 per cent of the respondents reported exports to be higher or same as compared to previous year's similar quarters. Export diversification efforts by the government and industry seem to be yielding results, the FICCI survey noted. It revealed that 43 per cent of the respondents are looking at hiring an additional workforce in the next three months as compared to 35 per cent in the last quarter. However, the average interest rate paid by manufacturers was reported to be 9.1 per cent for Q2 as compared to 8.9 per cent reported for the last quarter. As many as 90 per cent of the respondents reported sufficient availability of funds from banks for working capital or long-term capital. Production costs for manufacturers seem to remain on higher side.
The CNX Nifty is currently trading at 22612.55, down by 163.55 points or 0.72% after trading in a range of 22585.05 and 22692.95. There were 6 stocks advancing against 44 stocks declining on the index.
The top gainers on Nifty were Bajaj Finance up by 0.97%, Bharti Airtel up by 0.77%, Dr. Reddy's Lab up by 0.50%, Coal India up by 0.39% and Interglobe Aviation up by 0.28%. On the flip side, Titan Company down by 4.11%, Hindalco Industries down by 1.89%, Bharat Electronics down by 1.63%, Asian Paints down by 1.59% and Bajaj Auto down by 1.57% were the top losers.
Asian markets were trading in red; Nikkei 225 slipped 500.98 points or 0.71% to 70,183.00, Hang Seng declined 160.56 points or 0.67% to 24,120.00, Taiwan Weighted lost 60.95 points or 0.12% to 49,761.60, KOSPI dropped 60.10 points or 0.87% to 6,881.29, Jakarta Composite fell 37.64 points or 0.61% to 6,155.29 and Straits Times was down by 9.6 points or 0.17% to 5,618.82.
