The Sensex and Nifty 50 opened marginally lower and hovered near the flatline on October 11 as FII sell-offs, weak Q2 FY25 earnings projections, and rising geopolitical tensions rattled investor confidence. Banks and telecom stocks declined, but a resilient push from IT, and oil & gas prevented Nifty's steeper dive into the red.
At 10 AM, Sensex was down 25 points at 81,586 and Nifty 5o was up 5 points at 25,003.
Prashanth Tapse, Senior VP of Research at Mehta Equities said that Nifty's upward momentum seems limited by several factors such as Foreign Institutional Investors (FIIs) becoming net sellers, a situation that might aggravate with China considering a new stimulus package for its economy. Additionally, there are concerns about escalating Middle East tensions.
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"All eyes are on the details of the much-anticipated fiscal stimulus from Beijing this weekend," said Deepak Jasani, Head of Retail Research at HDFC Securities. China's Ministry of Finance is set to announce a new fiscal stimulus package on October 12, aimed at reviving its economy. According to Bloomberg, analysts expect Beijing to introduce up to 2 trillion yuan ($283 billion) in stimulus to support the world's second-largest economy.
The banking and financial services sector was the hardest hit among sectoral indices, driven by sell-offs in ICICI Bank, HDFC Bank, and Bajaj Finance. Meanwhile, Nifty IT rose over half a percent, led by gains in HCLTech, Wipro, and Persistent Systems. Metal stocks also surged ahead of China's stimulus announcement. The Nifty Metal index gained over 1 percent with Tata Steel, Hindalco, and Vedanta leading the charge.
Shares of IT giant Tata Consultancy Services fell 0.7 percent after the company reported misses in net profit, revenue, and margins for the quarter ended September.
With the earnings season underway, analysts expect stock-specific action to pick up.
In the broader market, both BSE Midcap and Smallcap indices rose 0.2 percent, outperforming the benchmarks.
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On the Nifty 50, ONGC, Hindalco, and HCLTech emerged as the top gainers, rising 0.6-1 percent. In contrast, ICICI Bank, TCS, and Cipla were the biggest losers, declining 0.6-2.4 percent.
"The outlook points to consolidation with a negative bias unless Nifty decisively surpasses the 25,300 mark," Centrum Broking said. "On the downside, a drop below the recent low of 24,700 could lead to fresh declines."
Asia-Pacific markets mostly rose, diverging from Wall Street, where key indices declined due to concerns over higher-than-expected inflation and rising unemployment claims.
Investors in Asia also reacted to the Bank of Korea's decision to cut its benchmark interest rate by 25 basis points to 3.25 percent, marking its first cut since 2020.
In the US, the Consumer Price Index (CPI) increased by 0.2 percent in September and 2.4 percent year-over-year, slightly above expectations. Meanwhile, jobless claims for the week ending October 5 jumped to 258,000, surpassing Reuter's forecast of 230,000.
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