Domestic indices likely to get flat-to-positive start tracking mixed global cues

Indian markets gave up all early gains to end on a flat note Tuesday tracking mixed cues from global markets. Today, domestic indices are likely to get flat-to-positive start tracking mixed global cues and a continued fall in oil prices, which slid about 1 percent to settle at a seven-month low on Tuesday on worries that demand from China could be weakening. Some support will come as revenue secretary Sanjay Malhotra ruled out any review of the long-term capital gains (LTCG) tax regime in the medium term. Some optimism will come as the government said the rupee remains one of the best performing currencies in 2024, with a much lower depreciation against the dollar than the currencies of Japan and South Korea. Traders may take note of the latest report on the State of Food Security and Nutrition in the World (SOFI 2024) showing that in what could come as a piece of good news, hunger in India - as measured by the Prevalence of Undernourishment (PoU) by the United Nation’s Food and Agriculture Organisation (FAO) - has come down from 16.6 per cent of the population in the 2020-2022 to 13.7 per cent in 2021-23.  However, foreign fund outflows likely to dent sentiments. On July 30, foreign institutional investors (FIIs) sold shares worth Rs 5,598.64 crore. Meanwhile, the Reserve Bank of India has asked lenders to examine wilful defaulters in all Non-Performing Assets (NPA) accounts with an outstanding amount of Rs 25 lakh and above and said the process should be completed in six months. The new norms will come into force after 90 days, that is, from November 1, 2024. Sugar industry stocks will be in focus as industry body Isma said India's gross sugar production is estimated to decline 2 per cent to 33.3 mn tonnes in 2024-25 marketing year starting October. There will be some reaction in gold related stocks with a private report that gold seems to be losing its glitter in India due to a rise in prices. Demand in the April-June 2024 quarter was 149.7 tonnes - a 5 per cent drop compared to 158.1 tonnes in the same period last year. Insurance industry stocks will be in limelight with a private report that life insurance companies are planning to seek a three-month deadline extension from the regulator on the implementation of surrender value norms. New product launches could slow down due to the new norms, which need to be implemented before September 30, 2024. Among individual stocks - Adani Power, Ambuja Cement, Bank of Baroda, BHEL, Coal India, Crompton Greaves, Deepak Fertilisers, Fino Payments Bank, Godrej Properties, JK Lakshmi Cement, Mahindra & Mahindra, Maruti, Nitin Fire Protection, Prestige Estates, RITES, Sonata Software, Sundaram Fasteners, Tata Steel and Zee Entertainment are likely to be in focus as these companies are scheduled to announce Q1 results today. In primary market, Utssav CZ Gold Jewels SME-IPO to open for subscription in the price band of Rs104 - Rs 110 on the NSE today.

The US markets ended mostly in red on Tuesday as investors awaited the Federal Reserve's decision. Asian markets are trading mostly higher on Wednesday ahead of key announcements, including the Bank of Japan's rate decision and business activity data from China.

Back home, a profit-booking at higher levels dragged Indian equity benchmarks to close the trading session near their neutral lines, as investors awaited cues from a slew of central bank meetings around the world. The Federal Reserve, the Bank of England and the Bank of Japan are holding their monetary policy meetings this week. Escalating Middle East tensions and China demand worries also rendered the underlying mood cautious. After a cautious start, markets witnessed volatility, amid foreign fund outflows. On July 29, foreign institutional investors (FIIs) sold shares worth Rs 2,474.54 crore. Some cautiousness came with a report that the government estimates its debt, including external borrowing, valued at current exchange rate and public account and other liabilities will increase to Rs 185 trillion, or 56.8 per cent of the GDP, during the current fiscal year. But, markets saw gaining rally in late morning deals and held it for the most part of the session, as economic think tank NCAER said the Indian economy could grow higher than 7 per cent and possibly closer to 7.5 per cent in the current fiscal on the back of normal monsoon and receded electoral uncertainty. Traders got support with Executive Director at the International Monetary Fund (IMF) Krishnamurthy Subramanian’s statement that reduction of corporate tax from 40 per cent to 35 per cent in the 2024 Indian Budget and removal of Angel Tax are among the measures that will promote India-US economic engagement. Some support also came as Union Labour Minister Mansukh Mandaviya reassured the public that there is no need for concern about job losses. He predicted that India's unemployment rate would fall below 3 per cent in the near future. Domestic sentiments remained optimistic in noon deals, as the Reserve Bank of India (RBI) in its latest report on Currency and Finance for the year 2023-24 showed that India is at the forefront of the digital revolution, leveraging on its digital public infrastructure, a vibrant financial technology (FinTech) ecosystem and a conducive policy environment to emerge as the fastest-growing digital economy in the world. However, a last hour correction dragged the markets to end flat. Finally, the BSE Sensex rose 99.56 points or 0.12% to 81,455.40, and the CNX Nifty was up by 21.20 points or 0.09% points to 24,857.30.