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Sensex, Nifty edge lower as HDFC Bank drags; US inflation data looms

1 week ago 34

Indian equity indices closed marginally lower in a highly volatile market on Wednesday, dragged by top private sector lender HDFC Bank. Additionally, IT stocks remained subdued as investors awaited key US inflation data, which could potentially impact future interest rate trends.

The 30-share BSE benchmark Sensex declined 118 points or 0.16% to settle at 72,987. The broader NSE Nifty dropped 17 points or 0.08% to end at 22,200.

The US inflation data is due later in the day. Hotter-than-expected inflation could lead to a further delay in US rate cuts.

Heaviest-weighted financial services dropped 0.3%, with HDFC Bank losing 1.4%. Nifty Auto, FMCG, and Media also closed in the red. On the flip side, Nifty PSU Bank, Realty, Metal, Oil & Gas, and Pharma closed in the green.

Among individual stocks, Canara Bank closed over 5% higher following its inclusion in the emerging markets index.

Berger Paints, deleted from the MSCI index, lost 1.7%. Indraprastha Gas fell 1.3% after the index provider downgraded it to the smallcap index from midcap.

Cipla shares also closed 3.5% higher after the promoter group of India's third-largest drugmaker sold a 2.53% stake via a block deal.

The market breadth was skewed in the favour of the bulls. About 2,204 stocks gained, 1,589 declined, and 142 remained unchanged on the BSE.

Expert Views

“The market witnessed a sideways movement throughout the day as the emotions of investors were impacted by the election-led jitters. The positive results from the capital goods sector and robust growth outlook gained investors’ attention and led the segment to outperform. A drop in US 10-year yield ahead of the release of sensitive CPI data from the US will be watched carefully by the market to gain insights on rates," said Vinod Nair, head of research at Geojit Financial Services.

Aditya Gaggar, director of Progressive Shares, said, "After a steep rally in the preceding days, the Index found resistance around its crucial hurdle of 22,240-22,330; a convincing move above the mentioned levels will push the Index further higher to 22,400 while on the lower side, 22,100 will be considered as a strong support."

Global Markets

The MSCI All-World share index traded at a record high, up 0.15% on the day, which brought gains for 2024 so far to 8.3%.

In European trading, the STOXX rose 0.3%, buoyed largely by healthcare shares, while US stock futures were broadly flat on the day, indicating a more muted start on Wall Street, where activity the previous day centred on the meme-stock rally.

Oil Prices Rise

Oil prices rose on Wednesday on expectations for higher demand as the US dollar weakened and a report showed US crude and gasoline inventories fell while the release of inflation data may point to a more supportive economic outlook.

Brent crude futures were up 39 cents, or 0.5%, at $82.77 a barrel. US West Texas Intermediate crude futures (WTI) rose 42 cents, or 0.5%, to $78.44 a barrel.

Currency Watch

The Indian rupee sidestepped gains in its broader Asian peers to end barely changed on Wednesday, as traders awaited the US consumer inflation data for cues on when the Federal Reserve may kick off rate cuts.

The rupee closed at 83.50 against the US dollar, compared to its previous close of 83.51. Meanwhile, the dollar index slipped 0.2% to 104.8.

(With inputs from agencies)

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