Indian equity benchmarks traded lower in Tuesday's trade ahead of inflation data from major economies and the Reserve Bank of India's (RBI's) monetary policy decision later this week. The 30-share BSE Sensex slipped 68 points or 0.10 per cent to trade at 65,885, while the broader NSE Nifty was down 14 points or 0.07 per cent to trade at 19,583. Although, mid- and small-cap shares were up as Nifty Midcap 100 rose 0.28 per cent and small-cap climbed 0.25 per cent.
Asian markets were subdued today. Overnight, Wall Street equities closed higher. Market participants expect consolidation in the benchmark indexes and earnings-driven, stock-specific action to continue over the next few sessions ahead of the US inflation data and RBI policy.
The Reserve Bank would announce its policy decision on Thursday. The central bank kept rates unchanged in April and June, after hiking them by 250 basis points (bps) in the fiscal 2023.
Foreign institutional investors (FIIs) turned net sellers in Indian equities for the seventh session in a row during the previous session, offloading shares worth Rs 1,893 crore, as per provisional NSE data.
Over the last seven sessions, FIIs have sold shares worth Rs 9,740 crore. In contrast, domestic institutional investors (DIIs) were net buyers in six of the past seven sessions and added Rs 1,081 crore.
"A significant near-term trend in the market now is the sustained selling by FIIs matched by the sustained buying by DIIs. It is important to understand that while FII activity is influenced by external factors like the Dollar Index and US bond yields, DII activity is predominantly determined by domestic factors like GDP growth and corporate earnings. In the near term the spike in the US 10-year bond yield above 4 per cent has triggered selling by FIIs who might be moving some money to US bonds," said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
Only two out of the 15 sector gauges -- compiled by the National Stock Exchange -- were trading in the red. Sub-indexes Nifty FMCG and Nifty Metal were underperforming the NSE platform by falling as much as 0.26 per cent and 0.02 per cent, respectively.
On the stock-specific front, Adani Ports was the top loser in the Nifty pack as the stock cracked 1.16 per cent to trade at Rs 782.20. Mahindra & Mahindra (M&M), Divi's Labs, Nestle India and Adani Enterprises fell up to 1.11 per cent.
In contrast, Hero MotoCorp, Cipla, Dr Reddy's, Tech Mahindra and Maruti Suzuki India were among the top gainers.
The overall market breadth was positive as 1,798 shares were advancing while 1,095 were declining on BSE.
On the 30-share BSE index, HDFC Bank, PowerGrid, M&M, Bharti Airtel, Infosys, Sun Pharma, Tata Consultancy Services (TCS) and ITC were among the top laggards.
Also, Graphite India, Olectra Greentech, HLE Glascoat, PB Fintech, Medplus Health Services, Reliance Infrastructure and Max Healthcare tanked up to 5.56 per cent. On the other hand, Gland Pharma, RateGain Travel, Caplin Point, Zen Technologies and HUDCO jumped up to 18.61 per cent.
On Monday, Sensex had gained 232 points or 0.35 per cent to settle at 65,953, while Nifty had moved 80 points or 0.41 per cent up to end the session at 19,597.
Nifty outlook
"The pause near 19,620 is very much on anticipated lines, but the patterns thereof have hardly showed any reversal signs as such. In other words, while 19,620 appears as an uptrend killer as previously pencilled in, there are enough signals to play for continuation of ongoing uptrend. We prefer to negotiate this situation by having downside marker at 19,590/19,570 while playing for 19,740s again. Further, supports at 19,540/19,490/19,450/19,415 shall effectively rule out a collapse," said Anand James, Chief Market Strategist at Geojit Financial Services.
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