Mid-day Mood | Sensex, Nifty slip as hot inflation print dampens hopes of rate cut by RBI

In the broader market, the BSE Midcap was flat, while the BSE Smallcap index rose by 0.6 percent.

Sensex and Nifty wiped out early gains by noon on October 15, dragged down by auto, oil & gas, and IT stocks. The hotter-than-expected September inflation report dampened hopes for a domestic rate cut this year, weighing on investor sentiment.

As of 11.55 AM, the Sensex had dropped 168 points or 0.2 percent to 81,804, while the Nifty was down 60 points to 25,067. Market breadth showed 1,708 shares advancing, 1,636 declining, and 108 remaining unchanged.

India's retail inflation surged to a nine-month high in September, driven by rising food prices, according to government data released on October 14. Annual inflation rose to 5.5 percent in September from 3.7 percent in August.

"The upside risks to inflation could further pressure the RBI, which is already weighing various global and domestic push-and-pull factors before jumping the rate-cut gun," said Emkay Global Financial Services.

In the broader market, the BSE Midcap was flat, while the BSE Smallcap index rose by 0.6 percent.

Sectoral Trend

Ten out of the 13 sectoral indices were in the red. The Nifty Auto index fell over a percent, as the prospects of delayed rate cuts spooked investors in the auto sector, which relies heavily on bank loans to drive sales.

IT stocks reversed early gains and turned flat, while the metal index dropped by nearly a percent.

Meanwhile, a 3.7 percent decline in Brent crude futures to $74.6 per barrel supported gains in oil marketing companies and paint stocks.

Fundamental View

"The sharp cut in Brent crude by 3 percent is a macro positive for India, but CPI inflation for September coming worse than expected at 5.49 percent is a concern and the MPC will be forced to take this seriously and postpone the rate cut to 2025," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Technical View

Mandar Bhojane, Technical Analyst at Choice Broking said that if Nifty struggles to stay above 25,000, the immediate support levels at 24,900 and 24,750 may present attractive buying opportunities for traders.

Key Nifty gainers

BPCL, Bharti Airtel, ICICI Bank, Asian Paints, Britannia

Key Nifty losers

Bajaj Auto, Wipro, Bajaj Finance, M&M, Hindalco

Key Sensex gainers

Bharti Airtel, ICICI Bank, Asian Paints, UltraTech Cement, HCLTech

Key Sensex losers

Wipro, Bajaj Finance, M&M, Tata Steel, Tech Mahindra

Stock moves

SpiceJet: Shares of the troubled low-budget carrier gained as much as 3 percent after the company informed that it has reached a settlement with two more lessors for an aggregated sum of $5 million.

TD Power Systems: Shares surged 6 percent after the firm bagged two major international gas engine generator orders worth Rs 142 crore.

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