Indian benchmark indices ended today’s volatile session on a flat note even as investors await current account data and the US Federal Reserve’s two-day rate-setting meeting, which will begin later tonight. BSE Sensex closed 7.79 points or 0.03% higher at 31,103.49 points, while NSE Nifty, the broader gauge, closed 9.5 points or 0.01% lower at 9,606.90 points.
Among BSE sectoral indices, power index gained the most by 0.78 percent, followed by Realty 0.75 per cent, infrastructure 0.55 per cent and consumer durables 0.33 per cent. On the other hand, IT index was down 1.00 percent, metal 0.83 per cent and auto 0.44 per cent.
Inflation numbers released yesterday show that India’s consumer inflation dipped to a five-year low in May on account of dropping food prices, Inflation is now well below the Reserve Bank of India’s (RBI) medium-term target of 4%, and at the lower end of its CPI projection of 2%-3.5% in the first half of the fiscal year.
April IIP growth slipped to a disappointing 3.1 percent in April, well below the revised 3.8 percent figure for March, raising hopes that the Reserve Bank of India may cut interest rates to boost the struggling industrial sector.
IIP growth at 3.1 percent “in the first month of FY18 is not very encouraging,” said Sunil Kumar Sinha, principal economist, India Ratings and Research, attributing it to the “lagged effect of demonetisation which may play out even in the first quarter of FY18.”
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While the US Federal Reserve is expected to hike the policy rate this time and the markets will keenly watch its stance on US economic growth and future rate hike trajectory, however, Fed’s outlook on downsizing its balance sheet will be even more keenly watched.
Major gainers on Sensex were PowerGrid up 1.94%, Lupin up 1.73%, HDFC up 1.52%, NTPC up 1.27% and Adani Ports up 0.67%, while the major losers were Tata Motors down 1.51%, TCS down 1.47%, Wipro down 1.44%, Hero MotoCorp down 0.65% and M&M down 0.65%.