Dear
Trader…
Indian equity indices Sensex and Nifty experienced gains
throughout the day but reversed course in the last hour, closing lower on
Wednesday, despite the central bank easing its policy stance to ‘neutral’,
opening the door for rate cuts in the coming months.
The 30-share BSE benchmark Sensex declined by 167 points, or
0.21%, settling at 81,467. The broader NSE Nifty future dropped by 47 points,
or 0.19%, ending at 24,083.
The market capitalisation of all listed companies on BSE
surged by Rs 2.74 lakh crore to Rs 462.24 lakh crore. The market breadth was
skewed in the favour of the bulls. About 2,706 stocks gained, 1,247 declined,
and 96 remained unchanged on the BSE.
The Reserve Bank of India (RBI) on Wednesday changed its
policy stance to neutral from withdrawal of accommodation while leaving the
repo rate unchanged at 6.5%.
Among the Sensex constituents, ITC, Nestle India, HUL,
Reliance Industries, and L&T were the top laggards, falling 1-3%.
Conversely, Tata Motors, Tech Mahindra, SBI, Maruti Suzuki, and Bajaj Finserv
ended with gains.
Rate-sensitive indices, such as the Financial Services index,
closed 0.4% higher, while Auto and Real Estate shares rose by 0.8% and 2.15%,
respectively. However, Nifty Bank closed flat.
The broader, more domestically focused Nifty Smallcap 100 and
Midcap 100 indices rose by 1.3% and 1%, respectively.
Meanwhile, the pharma index closed 2% higher, driven by an 8%
increase in Divi’s Laboratories after Citi initiated coverage of the
drugmaker’s stock with a ‘buy’ rating.
The IT index rose 0.55%, marking its fourth consecutive
session of gains, as labor market data eased recession concerns in the U.S., a
key revenue source for the sector.
Global
Markets – China’s runaway stocks rally
stuttered and commodities struggled to find a footing on Wednesday as investors
tempered their expectations for a robust Chinese economic recovery, keeping
pressure on shares globally.
Benchmark indexes in China notched up their biggest daily
losses since the COVID-19 pandemic began, with stocks in Shanghai and
blue-chips closing down 6.6% and 7.1% respectively, snapping a 10-day winning
streak.
MSCI world equity index, which tracks shares in
47 countries, fell 0.2%. Elsewhere, Japan’s Nikkei rose 1%.
Crude
Oil – Oil prices edged up on Wednesday as developments
in the Middle East took centre stage against cautious demand expectations and
ahead of a government meeting on China’s fiscal policy.
Brent crude futures rose 45 cents, or 0.6%, to
$77.63 a barrel. U.S. West Texas Intermediate futures rose 33 cents to $73.90 a
barrel.
Rupee
Ends Flat – The Indian rupee ended flat on
Wednesday while dollar-rupee forward premiums declined after the Reserve Bank
of India kept its benchmark rates unchanged but tweaked its policy stance to
“neutral”, opening the door for rate cuts.The rupee closed at
83.9625 against the U.S. dollar, unchanged from its closing level on Tuesday.
Nifty futures opened at 25185 points against the previous
close of 25131 and opened at a low 25050 points. Nifty Future closed with an
average movement of 307 points and rise of around 47 points and closed 25083 points…!!
Meanwhile,
The change in RBI’s stance to neutral was
favourable and expected, but the commentary is not pointing for a rate cut in
the near term. Meanwhile, the investor’s sentiment is buoyed on the broad
market taking opportunity on a stock-to-stock basis, to capitalise from the
recent correction.
An upward revision in Q3FY25 inflation reiterates that the
sticky inflation continues to remain a concern for the RBI and led investors to
book profit towards the close. The volatility in input prices and the impact on
margin dragged the FMCG stocks.
Technically, the
important key resistances are placed in Nifty future are at 25083 levels, which
could offer for the market on the higher side. stainability above this zone
would signal opens the door for a directional up move with immediate
resistances seen at 25188 – 25272 levels. Immediate support is placed at 25008 –
24808 levels.
Past Performance is not an Indicator of Future Returns. The
securities quoted are for illustration only and are not recommendatory. Investment
in securities market are subject to market risks. Read Disclaimer and related
all the documents carefully before investing, mentioned on www.nikhilbhatt.in
