Indian stock market: Stock benchmark ends almost flat tracking weak world stocks
India’s equity benchmark was mostly unchanged, tracking global equities weak as investors largely stayed on the sidelines ahead of the release of US inflation data, suggesting a tightening policy path. Federal Reserve.
After a positive opening, the market turned quite volatile throughout the session. The 30-stock BSE index closed Wednesday 35.78 points, or 0.06%, at 58,817.29 points, while the broader NSE Nifty rose 9.65 points, or 0.06%, to 17,534. 75.
“The markets traded in a tight range with a negative bias for most of the session, as traders,” said Shrikant Chouhan, Head of Retail Equity Research at Kotak Securities. Moving in a global direction and being cautious about important US inflation data.
The market remained range-bound for most of the session, traders said, as investors kept interest rates low due to weak global signals.
Bajaj Finance was the biggest loser in the Sensex package, down 2.66%, followed by NTPC, HCL Tech, Wipro, Asian Paints, Ultra Cement and SBI.
On the other hand, Tata Steel, Bharti Airtel, ICICI Bank, L&T and IndusInd Bank were the gainers.
The Nifty Metals Index closed 1.62% higher after hitting a three-month high earlier in the session.
Hindalco Industries closed 4.4% higher and was the top gainer in the Nifty 50 stock. Aluminum and copper producers reported a Quarterly profits up nearly 48%.
State-run coal miner Coal India grew 2.1% on quarterly earnings.
The Nifty Information Technology Index, resisting some gains, was the worst performer and closed 0.89% lower, suffering a second straight session of losses.
Of Nifty’s 50 stocks, 30 are trading in the green and the remaining 20 are in the red, National Stock Exchange data shows.
Over the past month, Sensex and Nifty have grown by about 7 to 8% each. Notably, Indian stocks recorded their best weekly performance in the week to July 22, marking their best week since February 2021.
“The positive from today’s session is that Nifty showed some resilience for sellers as the bulls stepped in after the morning wobble, taking their winning streak to three. Most importantly, the bulls hold on to Asia’s weak signals, inflation and recession, said Prashanth Tapse, Senior Vice President of Research at Mehta Equities.
Indian financial markets were closed in the previous session due to Muharram. On Monday, Indian equity benchmarks extended their gains after posting a third consecutive weekly gain, contrasting with larger losses in world stock markets.
But on Wednesday, the trading pattern was calm as the market awaited signs that inflation eased in July despite a surprisingly strong US jobs increase last week.
For now, however, the market is pricing in a close to 70% chance of a 75bps rate hike at the next Fed meeting.
David Chao, global market strategist for Asia Pacific excluding Japan, at Invesco, told Reuters.
“I don’t think the markets have fully discounted these variables. This week’s inflation data will certainly give us more insight into the Fed’s near-term policy outlook.”
Europe’s benchmark STOXX index fell 0.43%, following a larger 1.2% drop in the MSCI index of Asia-Pacific shares outside Japan, while Japan’s Nikkei closed down 0 ,65%.
US markets look set to open flat, with S&P 500 index futures down 0.06%.
The dollar is steady, having taken a pause from the retracement that began in mid-July. The dollar index, which measures the safe-haven greenback against six major currencies, was at 106.3.
Analysts note that US inflation data through Wednesday represent a lagging indicator that may not yet show inflation softening and yield curves could flatten or invert further. .
A flat yield curve is often considered a sign of a recession, and an inversion is a predictor of a recession. When measured by the gap between 2-year and 10-year forward yields, the U.S. curve inverts deeply below minus 40 bps.
