Markets likely to open in green tracking positive global cues

Indian markets ended Monday’s choppy session in positive territory as investors braced for a slew of central bank meetings this week. Today, markets are likely to open in green tracking positive global cues. Market participants eagerly await the Federal Reserve's policy decision this week slated on September 18. This is said to be the biggest event that would drive sentiments in the domestic stock market. Domestically, investors will keep an eye out for the release of Wholesale Price Index (WPI) inflation and manufacturing data for August, along with import and export data for August. Some support will come as Prime Minister Narendra Modi said that India is becoming a major stakeholder in the global supply chain and this growing capacity is the foundation of the country’s economic growth. He added innovation and collaboration are India’s greatest strengths on its development journey. Traders may take note of report that addressing the central bank's ongoing efforts to manage exchange rate fluctuations, Reserve Bank of India (RBI) governor Shaktikanta Das said that the rupee has emerged as one of the least volatile currencies worldwide, particularly since the start of 2023. He said the rupee has remained very stable against the US dollar and the volatility index. However, foreign fund outflows and higher crude oil prices likely to dampen sentiments in the markets.  As per NSE data, Foreign Institutional Investors (FII) were net sellers of Indian equities worth Rs 1,634.98 crore. Oil prices were trading higher as the ongoing impact of Hurricane Francine on output in the U.S. Gulf of Mexico offset persistent Chinese demand concerns ahead of this week's U.S. Federal Reserve interest rate cut decision. There may be some cautiousness as Reserve Bank of India Governor Shaktikanta Das said the benchmark interest rate in the country will hinge on the future trajectory of inflation. He emphasized that month-on-month inflation momentum - whether it’s building up or moderating - will be key to the central bank’s decision-making process. Meanwhile, shares of P N Gadgil Jewellers Ltd will be listed on the bourses today. 

The US markets ended with modest gains on Monday dragged by a drop in technology stocks as investors assessed the likelihood of an upsized rate cut from the US Fed this week. Asian markets are trading mostly higher on Tuesday as investors prepare for the Federal Reserve to kick off its monetary loosening cycle. 

Back home, Monday brought only limited gains for Indian equity markets as investors remained cautious ahead of the key US Federal Reserve’s meeting later this week. Recent US inflation data has partly offset optimism the US Fed will lower rates more aggressively, but the central bank is still expected to continue cutting rates over the next several months. The start of day was positive, as foreign fund inflows aided domestic sentiments. Foreign Portfolio Investors (FPIs) continued their bullish stance on Indian stocks, infusing Rs 16,881.03 crore in the second week of September, according to data from the National Securities Depository (NSDL). Besides, according to the payroll data, Employees’ State Insurance Corporation (ESIC) recorded a 13.32 per cent increase in subscribers addition to 22.53 lakh in July, 2024 compared to the figure of a year ago. In the middle of the trading session, markets wiped out gains to trade near neutral lines, tracking negative cues from European markets. Markets participants got cautious, as the think tank Global Trade Research Initiative (GTRI) said that India needs to increase container production, promote the use of domestic containers, strengthen domestic shipping firms and enhance port infrastructure as higher freight costs, container shortage and dependence on major shipping hubs and foreign carriers pose serious challenges to the country’s exports. However, indices again added gains during late afternoon session, as some support came amid report that India’s foreign exchange reserves have been rising for months now, hitting several all-time highs. The forex kitty increased by $66 billion so far this year and is currently at $689.235 billion. Finally, the BSE Sensex rose 97.84 points or 0.12% to 82,988.78, and the CNX Nifty was up by 27.25 points or 0.11% to 25,383.75.