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Indian markets, after one-day hiatus, resumed their broad-based downward trend on Wednesday led by profit booking in Reliance Industries, ICICI Bank, Power Grid, Maruti Suzuki, M&M, HDFC Bank, and L&T. Today, markets are likely to get slightly positive start after having suffered heavy losses in the previous session. Some support will come as economic think tank National Council of Applied Economic Research (NCAER) in report said that high frequency indicators reveal that the Indian economy remains resilient with Purchasing Manager's Index (PMI) for services accelerating and manufacturing regaining momentum. Further, NCAER said the composite PMI accelerated to 61.2 in January from 58.5 in December 2023. Meanwhile, the report by the Boston Consulting Group (BCG) and Retailers Association of India (RAI) said that India's retail sector is expected to grow at 9-10 per cent to reach $2 trillion in the next decade with the country's consumption story continuing to remain strong with steady growth. However, there will be some volatility in the markets ahead of the impending expiry of February series derivative contracts. Also, investors await the PCE inflation index in the US and India’s Q4 GDP data later in the day. There are expectations that India's economic growth probably slipped below 7% for the first time in the current fiscal year in the October-December period, hit by a tepid manufacturing sector and weakness in consumption. Besides, a report by SBI Research said the Indian economy is likely to grow at 6.7-6.9 per cent in December quarter FY24 as compared to 7.6 per cent growth in the second quarter on poor performance in the farm sector. Foreign fund outflows likely to dent sentiments. Foreign institutional investors (FIIs) net sold shares worth Rs 1,879.23 crore on February 28, provisional data from the NSE showed. There will be some reaction in semiconductor sector stocks as Union Minister of State for Electronics & Technology Rajeev Chandrasekhar said India has made significant strides in the semiconductor sector in the last two years and during this period, Rs 2.50 lakh crore worth of investment proposals have been received by the government from global chip makers. Real estate industry stocks will be in limelight with a private report that housing demand in India scaled up and prices across the top eight cities surged by about 20 per cent during 2021-2023. Meanwhile, the Nifty Next 50 Index will include Adani Power, Indian Railway Finance Corporation, Jio Financial, Power Finance Corp and REC. These companies will be replaced Adani Wilmar, Muthoot Finance, PI Industries, Procter & Gamble Hygiene and Shriram Finance. Moreover, GPT Healthcare is set to make Dalal Street debut today.

The US markets ended lower on Wednesday ahead of a key inflation reading that could heavily influence expectations on timing of rate cuts. Asian markets are trading mixed on Thursday in anticipation of more cues on U.S. interest rates from key inflation data.

Back home, Indian equity markets ended lower by over a percent in a highly volatile trade on Wednesday, due to selling in Utilities, Power and Oil & Gas stocks amid weak global market trends. After making flat-to-positive start, key gauges fell sharply amid cautiousness among investors ahead of key domestic and US data due on Thursday. India’s Q3 GDP data will be released tomorrow and polls indicated that growth moderated to 6.6 per cent in the third quarter of FY24. Some concern also came with provisional data from the NSE showing that foreign institutional investors (FIIs) net sold shares worth Rs 1,509.16 crore on February 27, 2024. Derivatives expiry on Thursday also fuelled volatility in the domestic markets. Weakness continued over the Dalal Street in afternoon deals, on the back of negative cues from European markets. Traders shrugged off Union Minister of Commerce and Industry Piyush Goyal’s statement that with the triple track of strong macroeconomic fundamentals, huge thrust in infrastructure creation and social welfare push India has been at the forefront of global growth for the past decade. The Minister further said that the thrust of increased foreign investments coupled with the nation’s contribution of a 3D vision of democracy, demography and demand, India’s economy is on fast track. Traders also paid no heed towards report stating that India would benefit from a move of over 70 nations like the UK, UAE and Australia that have agreed to take on additional obligations in the services sector under an agreement of the WTO. Traders took a note of rating agency ICRA’s latest report stating that the borrowing cost for states continued to fall for the third week in a row, with the weighted average price falling to 7.44 per cent in the debt auction on February 27, 2024. The cost had remained at a two-year high throughout January sniffing at 7.8 per cent. Finally, the BSE Sensex fell 790.34 points or 1.08% to 72,304.88 and the CNX Nifty was down by 247.20 points or 1.11% to 21,951.15.

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