The two key domestic benchmarks, Sensex and Nifty, on Friday started trade on a negative note tracking mixed Asian trends. Investor sentiment got dented mostly because of higher forecast of domestic inflation by the Reserve Bank of India. At 9.50 am, the S&P BSE Sensex declined 220 points 65,468. On the other hand, the NSE Nifty50 was trading at 19,472, down 70 points.
On the 30-share Sensex platform, JSW Steel, NTPC, ICICI Bank, HUL, IndusInd Bank, Airtel emerged losers. On the flip side, HCL, PowerGrid, Titan, Tata Motors, Maruti, SBI, and L&T were the only gainers. Among specific stocks, shares of Zee Entertainment were flat after 18-per cent surge on Thursday after the NCLT approved its merger with Sony India on Thursday. LIC surged 4 per cent after the company’s Q1 net profit more than doubled to Rs 9,543.71 crore for the quarter ended June 2023 when compared with Rs 4,831.65 crore in the same quarter a year ago.
In the broader markets, the BSE Midcap and Smallcap indices went up by 0.3 per cent gains each.
Sectorwise, the Nifty IT index advanced 0.7 per cent, while the Nifty Metal, Bank, Pharma, and Financial Services indices dropped 0.4 per cent each.
In the previous session on Thursday, the S&P BSE Sensex plunged 308 points lower at 65,688, while the NSE Nifty50 closed with a loss of 89 points at 19,543.
"The only negative from the RBI’s message yesterday is the hike in I- CRR to neutralise the excess liquidity created by the withdrawal of the Rs 2,000 notes. The sentimental impact of this decision is unlikely to last long since it will not impact the banking sector’s bottom line much since the NPAs of banks are coming down and the credit growth in the economy is good," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
In Asian markets, Shanghai and Hong Kong were quoting lower while Seoul traded in the green. The US markets ended with gains on Thursday.
Foreign Institutional Investors (FIIs) were buyers on Thursday as they bought equities worth Rs 331.22 crore, according to exchange data. "On the domestic front, post the monetary policy outcome, the focus will be on today's IIP numbers to be released after the market hours," Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd said.
Global oil benchmark Brent crude declined 0.02 per cent to $86.38 a barrel.
Meanwhile, the rupee depreciated by 8 paise to 82.74 against the US dollar in early trade on Friday, tracking a firm dollar against major rivals overseas. Analysts said, weak sentiment in the domestic equity market and elevated level of crude prices nearing $87 per barrel also weighed on the domestic unit.
On Thursday, the Reserve Bank of India in its bi-monthly monetary policy review decided to keep key interest rate unchanged, but hinted at tighter policy if food prices drive inflation higher. The American currency regained after US consumer price inflation showed moderation in July, raising hopes that the US Federal Reserve would pause rate hike.