GIFT NIFTY SIGNALS A NEGATIVE START ON MIXED ASIAN CUES

GIFT Nifty:

The GIFT Nifty September futures contract is down 47 points, suggesting a negative start for the Nifty 50.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 2,547.53 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 2,012.86 crore in the Indian equity market on 19 September 2024, provisional data showed.

FPIs have bought shares worth over Rs 15084 crore in September 2024 (so far). They sold shares worth 21,368.51 crore in August 2024.

Global Markets:

Asian stocks were mixed on Friday, following a significant interest rate cut in the United States the previous day.

The yen remained volatile ahead of a Bank of Japan monetary policy decision, as traders anticipated clues about potential tightening.

Japan`s consumer price index inflation rose as expected in August, reflecting increased consumption driven by higher wages. This reading came just before the Bank of Japan`s meeting later that day.

Core CPI, excluding volatile fresh food prices, increased by 2.8% year-on-year in August, reaching a 10-month high. This figure was in line with expectations and up from the 2.7% recorded in the previous month. A core reading that excludes both fresh food and energy prices, closely watched by the BOJ as a gauge of underlying inflation, rose to 2% in August from 1.9% in the prior month. Headline CPI inflation reached a 10-month high of 3% in August, up from 2.8% in the previous month.

In China, the central bank maintained its benchmark lending rates, disappointing hopes for immediate policy support to bolster its struggling economy.

US stocks surged to new all-time highs on Thursday, as markets welcomed the Federal Reserve`s aggressive interest rate cut to protect the labor market. The S&P 500 gained 1.7%, reaching 5,713.64, while the tech-heavy Nasdaq Composite Index jumped 2.5% to 18,013.98.

The Fed on Wednesday reduced its key lending rate by 0.50%, opting for a larger cut after considering a quarter-point move.

Domestic Market:

The domestic equity benchmarks concluded a volatile trading session with modest gains on Thursday. The market was buoyed by the US Federal Reserve`s decision to cut interest rates by 50 basis points and its indication of further rate reductions. However, the substantial rate cut also sparked concerns about a potential global slowdown, leading to profit booking in mid-cap and small-cap stocks. The Nifty50 settled above the 25,400 level. Private banks and FMCG stocks were among the top performers, while media, energy, and public sector banks witnessed selling pressure. The volatility in the market was further amplified by the weekly expiry of futures and options contracts.

The S&P BSE Sensex rose 236.57 points or 0.29% to 83,184.80. The Nifty 50 index added 38.25 points or 0.15% to 25,415.80.

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