The Sensex and Nifty opened slightly lower despite CPI inflation reaching its lowest point in five years.
Mumbai (Maharashtra) [India], August 13 (ANI): On Tuesday, the stock market opened on a subdued note, reflecting recent economic data. India’s consumer price index (CPI) dropped to 3.54 percent in July 2024, marking nearly a five-year low, below the Reserve Bank of India's (RBI) 4 percent target, while industrial production (IIP) grew by 4.2 percent in June 2024. Despite these developments, market sentiment remained cautious, resulting in a flat opening.
The benchmark Sensex started the day 100.55 points lower at 79,548.37, and the Nifty opened down by 26.45 points at 24,323.60.
Despite the positive inflation figures, investor sentiment was dampened by concerns over global economic factors and mixed signals from the domestic market.
Among Nifty companies, market breadth was evenly split, with 25 stocks advancing and 25 declining.
ICICI Bank, Apollo Hospitals, Kotak Mahindra Bank, Axis Bank, and Britannia were the top gainers in early trade, while HDFC Bank, Shriram Finance, BPCL, Divi's Laboratories, and LTIMindtree were among the top losers.
Ajay Bagga, a well-known banking and market expert, remarked on the market’s flat opening, saying, "Global markets are holding steady, awaiting the US inflation data this week. Indian markets handled the Hindenburg issue well on Monday. Currently, global factors are driving the market, with oil prices rising due to geopolitical risks in the Middle East. The drop in Indian inflation growth for July was expected and is unlikely to significantly impact the market."
He continued, "This lower figure is due to the base effect from last year’s high numbers. It’s temporary, and Indian inflation is expected to exceed 4.4 percent by September. The key market factors remain geopolitical risks, the Fed’s rate cut trajectory, and the BOJ policy actions that have caused a disorderly unwind of the Yen carry trade. Markets are likely to remain sideways for now, awaiting clarity on these three major themes."
As trading continues, investors will closely watch both domestic and international developments, particularly regarding inflation trends, central bank policies, and geopolitical risks, which are expected to influence market movements in the near term.