IGI Logo

Indian markets exhibited a weak trend and ended lower for the eighth straight trading session on Tuesday amid sustained selling in index heavyweights such as - Reliance, Infosys, Tata Steel and ITC. Today, the start new month is likely to be negative amid overnight losses on Wall Street coupled with weak GDP data on domestic front. data released by the Ministry of Statistics and Programme Implementation showed that India's gross domestic product (GDP) growth rate fell for the second consecutive quarter in October-December, coming in at 4.4%, it is lower than the 6.3% growth in the second quarter of 2022-23. Continued foreign fund outflows likely to dent domestic sentiments. Foreign institutional investors (FII) sold shares worth Rs 4,559.21 crore on February 28, the National Stock Exchange's provisional data showed. Traders will be concerned as a report from S&P Global Market Intelligence showed Private equity (PE) investments in India dropped 23.4% in 2022 from a year earlier. Traders may take note of India Ratings’ statement that the record heat in February can lead to more rate hikes from RBI. Besides, the central government's fiscal deficit for the first 10 months of 2022-23 widened to Rs 11.91 lakh crore. At Rs 11.91 lakh crore, the fiscal deficit for April 2022-January 2023 accounts for 67.8 percent of the full-year target for 2022-23. However, some respite may come later in the day as production of eight infrastructure industries - the core sector - expanded 7.8% year-on-year (YoY) in January, its fastest pace in four months, owing to a lower base and a near all-round showing. Some support will also come as Chief Economic Advisor V Anantha Nageswaran said high frequency data indicate buoyant economic growth momentum and the 7% GDP growth estimate for the current fiscal is very realistic. He also said that there are enough signs that manufacturing is in good health. The auto sector stocks will also be in action, reacting to their monthly sales numbers. Ratings agency Crisil said India's passenger vehicle sales are expected grow about 9%-10% in fiscal year 2024, roughly 20% above pre-pandemic peak levels, as strong demand and easing chip shortages prop-up the world's fourth-largest car market. Meanwhile, Automotive component maker Divgi TorqTransfer Systems to launch its initial public offering (IPO) and the issue will open for subscription on March 1.

The US markets ended lower on Tuesday as more evidence of stubborn inflation added to expectations that central banks will keep rates high. Asian markets are trading in green on Wednesday as investors await a slew of key economic data across the region.

Back home, Indian equity benchmarks continued their slide for the eighth straight day on Tuesday due to selling in Metal, Oil & Gas and Energy stocks amid worries over further interest rate hikes. Investors remain cautious ahead of India’s GDP data for the October-December 2022 quarter (Q3FY23) to be released later in the day. After making a cautious start, markets traded marginally higher as traders took some support with Comptroller & Auditor General of India (CAG) G C Murmu’s statement that the blue economy occupies a vital position in India's economic growth and it could well be the next multiplier of GDP and well-being, provided sustainability and socio-economic welfare are kept at the centre stage. However, soon markets cut initial gains and fell sharply lower in afternoon deals, as traders got anxious with ICRA Ratings’ stating that India Inc's operating profit margin narrowed by a sharp 2.37% in the December quarter to 16.3% on an annual basis due to high inflation and rising energy costs. Traders were also cautious amid a private report stating that a dove-turned-hawk in India’s monetary policy committee said demand in the economy was leading to significant price gains and high interest rates are required to keep a lid over inflation, including the core measure. Continued foreign fund outflows also dented the market sentiment. Foreign institutional investors (FII) sold shares worth Rs 2,022.52 crore on February 27, the National Stock Exchange's provisional data showed. Finally, the BSE Sensex fell 326.23 points or 0.55% to 58,962.12 and the CNX Nifty was down by 88.75 points or 0.51% to 17,303.95.

Above views are of the author and not of the website kindly read disclaimer