India's Equity Markets Open Flat as ITC Block Deal Weighs on Broader Gains
By 9:20 a.m. IST, the Nifty 50 was up 0.08 per cent at 24,840.65, and the BSE Sensex edged higher by 0.02 per cent to 81,591.54.
Market Update at 10:20 AM: India's benchmark indices showed little movement at the opening on Wednesday, as inflows into large block deals and the primary market balanced the boost from positive global cues. By 9:20 a.m. IST, the Nifty 50 was up 0.08 per cent at 24,840.65, and the BSE Sensex edged higher by 0.02 per cent to 81,591.54.
Out of the 13 key sectoral indices, 11 traded in the green. The broader Small-Cap and Mid-Cap indices rose 0.5 per cent and 0.2 per cent, respectively. However, consumer stocks underperformed, with the Nifty FMCG index dropping 1.1 per cent as 12 out of its 15 constituents declined. ITC fell 3.5 per cent, dragging down both the FMCG index and the Nifty 50.
The decline in ITC came after British American Tobacco announced plans to offload a 2.3 per cent stake in the company, valued at roughly USD 1.4 billion, through a block deal. This marked the second major block trade in the Indian market this week, following IndiGo co-founder Rakesh Gangwal's sale of a 5.7 per cent stake in the airline.
HDFC Bank and Reliance Industries slipped by 0.2 per cent and 0.5 per cent, respectively. Meanwhile, Asian markets gained slightly, supported by easing trade tensions between the U.S. and Europe and a drop in U.S. Treasury yields.
Pre-Market Update at 8:00 AM: On Wednesday, May 28, Indian equity markets are anticipated to start on a flat note. Early trading data at 7:30 am showed the GIFT Nifty hovering around 24,854, down marginally by 3 points from its previous close.
Asian markets opened higher, buoyed by the strongest rally on Wall Street in over two weeks. This positive sentiment came on the back of a rebound in US consumer confidence and an announcement by President Donald Trump delaying the imposition of a planned 50 per cent tariff on imports from the European Union.
Although the broader market may remain subdued initially, investors are expected to focus on stock-specific movements as several Indian companies release their fourth-quarter results. Notable Q4 earnings due today include Cummins India, IRCTC, Steel Authority of India, 3M India, Cohance Lifesciences, Deepak Nitrite, JSW Holdings, Nuvama Wealth Management, and Welspun Corp.
Life Insurance Corporation of India (LIC) reported a 38 per cent increase in net profit for Q4 of FY 2024-25, reaching Rs 19,013 crore compared to Rs 13,763 crore a year earlier. The company’s board also declared a final dividend of Rs 12 per share for the fiscal year.
On May 27, Foreign Institutional Investors (FIIs) were net buyers, acquiring shares worth Rs 348.45 crore. Domestic Institutional Investors (DIIs) showed stronger buying interest, purchasing stocks worth Rs 10,104.66 crore on the same day.
The Indian markets closed lower on Tuesday, breaking a two-day winning streak. The Sensex fell sharply by 624.82 points (0.76 per cent) to end at 81,551.63, while the Nifty 50 slipped 174.95 points (0.70 per cent) to finish at 24,826.20. Profit booking amid volatile trading pressured the indices.
Asian stocks performed well early Wednesday. Japan’s Nikkei 225 gained 0.56 per cent, and the Topix index rose 0.54 per cent. South Korea’s Kospi surged 1.86 per cent, with the Kosdaq up 0.59 per cent. Hong Kong’s Hang Seng also opened on a positive note.
U.S. equity markets posted solid gains on Tuesday, supported by positive consumer confidence data and President Trump’s decision to delay tariffs. The Dow Jones surged 740.58 points (1.78 per cent) to 42,343.65, the S&P 500 advanced 118.72 points (2.05 per cent) to 5,921.54, and the Nasdaq Composite jumped 461.96 points (2.47 per cent) to close at 19,199.16.
The dollar index eased slightly by 0.1 per cent, helping gold to gain appeal among buyers using other currencies.
Oil prices dipped about 1.5 per cent on Tuesday amid cautious sentiment over potential supply increases. Ongoing discussions between Iran and the U.S., as well as speculation that OPEC may raise output at its upcoming meeting, pressured prices. Brent crude was last seen trading at USD 63.73 per barrel, down 99 cents, while U.S. WTI crude fell USD 1.02 to USD 60.48 per barrel.
Gold prices edged up 0.3 per cent to USD 3,310.06 per ounce, supported by a softer dollar and lower U.S. bond yields. Investors are awaiting the upcoming US core PCE inflation data for indications on future interest rate moves.
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Disclaimer: The article is for informational purposes only and not investment advice.