Markets likely to open in red amid weak global cues

Indian markets ended Wednesday's choppy session marginally higher, with IT stocks outperforming. Today, markets are likely to open in red amid weak global cues after Nvidia's better-than-expected results failed to boost investors' confidence in the US market. Traders also await the release of the Federal Reserve's preferred inflation gauge on Friday for signals on U.S. interest-rate reductions. Domestic front, there will be some volatility in the markets on account of monthly expiry of derivative contracts later in the day. Investors will have their eyes peeled for the Mukesh Ambani-led Reliance Industries Annual General Meeting, scheduled for today afternoon. There will be some cautiousness as National Council of Applied Economic Research (NCAER) in its monthly economic review for August 2024 said that high-frequency indicators reveal that the domestic economy has remained resilient, but the outlook remains softer due to moderation in a couple of indicators. However, traders may take note of report that Reserve Bank of India (RBI) Governor Shaktikanta Das highlighted India’s transformation into a fast-growing economic powerhouse. Das attributed this growth to the country's tech-savvy population and an increasingly dynamic fintech ecosystem. Besides, India is poised for a transformative industrial revolution with the development of 12 new Industrial Smart Cities under the National Industrial Corridor Development Programme (NICDP). Union Minister Piyush Goyal highlighted the Rs 28,602 crore investment aligning with the vision of Viksit Bharat, aimed at generating 1 million direct jobs and 3 million indirect jobs. There will be some buzz in fintech sector stocks with a private report that India's fintech sector recorded a remarkable 50% growth rate in 2023, a figure significantly higher than the global average of 13%. The report projects that the Indian fintech sector's revenues will surge to $190 billion by 2030, contributing to over 20% of all banking revenues. Stocks related to railways will be in focus after the Cabinet Committee on Economic Affairs, chaired by Prime Minister Narendra Modi, has approved three railway projects with a total estimated cost of Rs 6,456 crore. There will be some reaction in stocks related to healthcare sector as Union Minister of State for Commerce & Industry Jitin Prasada highlighted India’s emergence as a premier, cost-effective healthcare destination and a global leader in pharmaceuticals. Edible oil industry stocks will be in limelight with a private report that India is considering an increase in import taxes on vegetable oils to help protect farmers reeling from lower oilseed prices. 

The US markets ended lower on Wednesday with tech stocks coming under selling pressure before Nvidia's earnings release and Friday's PCE data. Asian markets are trading mostly in red on Thursday with tech stocks dragging South Korean and Taiwanese indexes after Nvidia' second-quarter results.

Back home, Wednesday was yet another day with marginal gains for Indian equities. After a slightly positive beginning, indices witnessed volatility, as traders remained cautious ahead of the release of key US inflation report later in the week, which could impact expectations for how quickly the US Fed will cuts interest rates. However, markets gained traction during mid of the trading session, amid foreign fund inflows. Foreign institutional investors (FIIs) purchased shares worth Rs 1,503.76 crore on August 27. Traders took note of Indian Ambassador to Oman Amit Narang stating that discussions for the proposed free trade agreement (FTA) between India and Oman are at an advanced stage and both sides hope to conclude the pact early. He said the pact will give a significant push to bilateral trade and investment ties between the two countries. Sentiments were positive amid a private report stating that the government is finalising changes in various debt recovery laws to empower banks and other lenders to quickly resolve non-performing loans. The measures include enabling special Debt Recovery Tribunals (DRTs) to handle high-value cases and granting legal validity to e-notices sent by banks. Further, on a day of completion of ten years of successful implementation of the Pradhan Mantri Jan Dhan Yojana (PMJDY), Union Minister for Finance and Corporate Affairs Nirmala Sitharaman has said that ‘Universal and affordable access to formal banking services is essential for achieving financial inclusion and empowerment.’ But, the momentum on Dalal Street slowed down in the last leg of trade and finally indices ended just above neutral lines. Finally, the BSE Sensex rose 73.80 points or 0.09% to 81,785.56, and the CNX Nifty was up by 34.60 points or 0.14% to 25,052.35.