- India’s Sensex turns south after witnessing a positive open on Wednesday.
- Sensex swung between gains and losses on Tuesday, as markets stayed cautious ahead of India/ US CPI data.
- For February, US CPI came in hotter-than-expected at 3.2% YoY; India’s inflation stayed flat at 5.09% YoY.
The Sensex 30, one of India’s key benchmark indices, has reversed early gains to dip into the red on Wednesday, snapping Tuesday’s positive momentum.
The muted trading in the Gift Nifty futures combined with mixed Asian stock markets contributed to the weak tone around the Indian index. Sell-off in the metals and utility sector stocks also dragged the Sensex lower.
At the press time, the Bombay Stock Exchange (BSE) Sensex 30 is down 0.43% on the day at 73,350, retracing from intraday highs of 74,052.
Stock market news
- The top gainers on Sensex so far this Wednesday are ITC, Nestle, HDFC Bank, Bajaj Finance and ICICI Bank. Meanwhile, the top losers include Power Grid, NTPC, Tata Steel, Bharti Airtel and Titan Company.
- Shares of ITC are rebounding amid an expected 3.50% stake sale by British American Tobacco (BAT) in the company on Wednesday.
- India’s rising valuations prompt foreign companies to sell holdings.
- Indian government allows the Reserve Bank of India (RBI) to import gold without paying import levies.
- India’s headline CPI retail inflation came in at 5.09% in February compared to the 5.1% print for January. Meanwhile, the country’s Industrial Production stayed unchanged at 3.8% in January, missing the estimates of 4.1%.
- The US stock markets rebounded firmly on Tuesday, as a mixed US Consumer Price Index (CPI) report failed to have any impact on the June Fed rate cut expectations.
- The US CPI rose 3.2% in February from a year ago, beating the market forecast of 3.1%. The monthly CPI increased 0.4% in the same period. Core CPI, which excludes food and energy prices, increased 0.4% from the last month and 3.8% over the year.
- Markets continue to price in about a 70% chance that the Fed could begin easing rates in June, according to the CME FedWatch Tool.
- Attention now turns toward the US Retail Sales and consumer sentiment data due later this week.
Nifty 50 FAQs
The Nifty 50, or simply Nifty, is the most commonly followed stock index in India. It was launched in 1996 by the National Stock Exchange of India (NSE). It plots the weighted average share price of 50 of the largest Indian corporations, offering investors comprehensive exposure to 13 sectors of the economy. Each corporation’s weighting is based on its “free-float capitalization”, or the value of all its shares readily available for trading.
The Nifty is a composite so its value is dependent on the performance of the companies that make up the index, as revealed in their quarterly and annual results. Another factor is government policies, such as when in 2016 the government decided to demonetize 500 and 1000 Rupee banknotes. This led to a temporary cash shortage which negatively impacted the Nifty. The level of interest rates set by the Reserve Bank of India is a further factor as it determines the cost of borrowing. Climate change, pandemics and natural disasters are also drivers.
The Nifty 50 was launched on April 22, 1996 at a base level of 1,000. Its highest recorded level to date is 22,097 achieved on January 15, 2024 (this is being written in Feb 2024). The index first closed above the 10,000 level on October 17, 2017. The Nifty recorded its biggest daily decline on March 23, 2020 during the Covid pandemic, when it fell 1,125 points or 12.37%. The Nifty’s biggest gain in a single day occurred on May 18, 2009, when it rose 651 points after the results of the Indian elections.
Major corporations in the Nifty 50 include HDFC Bank, Reliance Industries, ICICI Bank, Tata Consultancy Services, Larsen and Toubro, ITC Ltd, Housing Development Finance Corporation Ltd and Kotak Mahendra Bank.
Source: https://www.fxstreet.com/news/sensex-eyea-a-subdued-opening-on-wednesday-amid-mixed-global-cues-202403130225