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Indian markets ended Wednesday's session higher despite weak cues from global markets. Today, markets are likely to start session on positive note tracking gains in Asian counterparts. Foreign fund inflows likely to support markets. According to the provisional data available on the NSE, foreign institutional investors (FII) bought shares worth net Rs 922.84 crore on July26. Traders may take note of Prime Minister (PM) Narendra Modi’s statement that India would be among the top three economies in the world in his third term, the leitmotif of which would be to achieve rapid progress, eradicate poverty, and transform India into a developed and prosperous nation within the next 25 years. However, some volatility may creep in the markets ahead of monthly F&O expiry later in the day. Investors will be looking ahead to the Goods and Services Tax Council meeting to be held of August 02. The agenda is expected to include a final decision on the proposed 28 per cent GST on online gaming, casinos and horse racing. Meanwhile, the International Monetary Fund has said it would encourage India to remove restrictions on export of a certain category of rice, which, it said, would have an impact on global inflation. Banking stocks will be in focus with a private report that private sector banks reported a robust 37.0 per cent year-on-year (YOY) growth in net profit to Rs 37,683 crore in the first quarter ended June 2023 on healthy growth in net interest income (NII) and strong credit offtake. IT stocks will be in limelight after Tech Mahindra reported disappointing Q1 numbers. Market participants will continue to focus on the April-June (Q1FY24) quarter results of fiscal year 2023-24. On Thursday, July 27, companies like Bajaj Finserv, Nestle India, ACC, Indian Hotels, Shriram Finance, Bharat Electronics, are some of the prominent names to report Q1FY24 scorecard.

The US markets ended mostly in red on Wednesday as the Fed left the door open for further tightening till their target inflation (2 per cent). Asian markets are trading mostly in green on Thursday though overall gains remained limited ahead of the ECB and BOJ policy meetings.

Back home, Indian equity benchmarks ended higher on Wednesday, with both Sensex and Nifty closing higher by 351 and 97 points, respectively, led by gains in shares of select heavyweights including Reliance Industries, Larsen & Toubro and ITC. After making a positive start, key indices extended gains, as traders got encouragement after the International Monetary Fund (IMF) in its latest update of the World Economic Outlook (WEO) revised upward India’s growth rate projection by 0.2 percentage point to 6.1 per cent for 2023, from earlier projection in April. It said this is reflective of the momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment. Some optimism also came with provisional NSE data showing that foreign institutional investors (FIIs) bought Rs 1,089 crore of Indian equities on a net basis during the previous session, while domestic investors sold Rs 334 crore of shares. Sentiments remained up-beat in afternoon deals, as traders took solace with minister of state for finance Pankaj Chaudhary’s statement that India’s general government debt moderated to 80.9% of the Gross Domestic Product (GDP) in 2022-23 from 83.3% in 2021-22. The general government debt, which comprises the debts of the centre and states, had soared to 87.8% in FY21, the highest in at least four decades, as government expenditure rose during the Covid-19 pandemic, amid revenue slump. However, markets trimmed some gains in late afternoon deals, as global cues were weak ahead of the US Fed interest decision later today. Meanwhile, Reserve Bank of India (RBI) Deputy Governor M Rajeshwar Rao said the Reserve Bank of India will soon issue guidance to banks for the identification of risks to their credit portfolio from climate-related issues. Finally, the BSE Sensex rose 351.49 points or 0.53% to 66,707.20 and the CNX Nifty was up by 97.70 points or 0.50% to 19,778.30.

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