Barometers turn rangebound, Nifty hovers above 18,000 level

The key equity indices traded in a narrow range with moderate gains in the mid-morning trade. The Nifty hovered above the 18,000 level. Consumer durables, financial services and metal shares were in demand while, IT, oil & gas and media stocks declined. Investors kept a close eye on the U.S. inflation data due on Tuesday which will offer a crucial guide to the interest rate outlook.

At 11:30 IST, the barometer index, the S&P BSE Sensex, was up 372.97 points or 0.62% to 60,488.10. The Nifty 50 index gained 110.70 points or 0.62% to 18,047.05.

In the broader market, the S&P BSE Mid-Cap index rose 0.47% while the S&P BSE Small-Cap index gained 0.46%.

The market breadth was strong. On the BSE, 1,996 shares rose and 1,333 shares fell. A total of 143 shares were unchanged.

Economy:

India`s consumer price inflation rose to 7% in August from 6.71% in July, figures from the National Statistical Office revealed Monday. In the same period last year, inflation was 5.30%. Food price inflation advanced to 7.62% in August from 6.69% in the previous month. Month-on-month, consumer prices gained 0.52% and food prices moved up 0.75% in August.

Meanwhile, India`s industrial production logged an annual growth of 2.4% in July, much weaker than June`s 12.7% expansion, data released by the National Statistical Office showed Monday. In the same month of 2021, industrial output had advanced 11. %. Among three main sectors, manufacturing output grew 3.2% and electricity output climbed 2.3%. On the other hand, mining shrank 3.3% from the last year. In the April to July period, industrial production posted an expansion of 10% annually.

Buzzing Index:

The Nifty Financial Services index rose 0.75% to 18,575.20. The index added 1.04% in two trading sessions.

Bajaj Finserv (up 5.2%), HDFC Life Insurance Company (up 1.99%), Housing Development Finance Corporation (up 1.33%), SBI Life Insurance Company (up 1.07%), HDFC Bank (up 1.01%), HDFC Asset Management Company (up 0.86%), Bajaj Finance (up 0.74%), Axis Bank (up 0.62%) and SBI Cards & Payment Services (up 0.5%) advanced.

On the other hand, ICICI Lombard General Insurance Company (down 0.8%), Power Finance Corporation (down 0.09%) declined.

Stocks in Spotlight:

Tata Consultancy Services (TCS) shed 0.26%. The IT major said that it has been chosen by C&S Wholesale Grocers to build a new operations platform on Google Cloud to reduce the company`s carbon footprint and enhance the customer experience. C&S has partnered with TCS to reimagine its operations platforms, including customer experience and grocery distribution. TCS will lead the company-wide project and help C&S establish a new cloud-based architecture that will unify its current systems, said TCS.

SIS declined 0.36%. SIS Australia Group, a subsidiary of SIS has signed shareholders` agreement on 12 September, 2022 to acquire an additional 15% shareholding in Safety Direct Solutions (SDS). SIS Australia Group already held 85% shareholding of SDS, through this transaction it proposes to acquire an additional 15% shareholding of SDS. The company said that the cost of acquisition will be determined based on a formula related to the performance of SDS in 2 years. The acquisition is estimated to be completed by 30 September 2024.

Gujarat Apollo Industries was locked in 20% upper circuit after the company said that it has entered into a joint venture (JV) agreement with Belgium-based PFH BV (Keestrack). The proposed joint venture will result in increased efficiencies and allow the company to offer improved products in the market, by harnessing each other`s synergies.

Global Markets:

Asian stocks traded higher on Tuesday as investors look ahead to the U.S. inflation report for the month of August. Headline inflation in the U.S. is expected to decline in August, as per reports. But core inflation, excluding energy and food, is projected to rise.

Wall Street equity indexes closed higher on Monday boosted by weaker dollar and growing confidence that higher prices have peaked.

Global markets are gearing up for the latest reading of U.S. inflation, with the August data set to be released Tuesday. The report is one of the last pieces of data on inflation the U.S. Federal Reserve will see ahead of its September meeting, where the central bank is expected to deliver its third consecutive 0.75 percentage point rate hike in an effort to combat high inflation.

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