Indian Benchmark Indices Slip as IT and FMCG Drag Indices Lower

Market Update at 12:30 PM: Indian stock markets gave up early gains on Friday as selling pressure in information technology (IT) and FMCG counters dragged benchmark indices lower, despite optimism around GST reforms.

As of 12:00 PM, the BSE Sensex was trading at 80,438.14, down 279.87 points or 0.35 per cent. The Nifty50 stood at 24,655.90, lower by 77.00 points or 0.31 per cent.

On the list of top Sensex gainers, Eternal, M&M, Power Grid, Maruti Suzuki, Reliance Industries, and Bajaj Finserv advanced between 0.5 per cent and 2.5 per cent. On the downside, ITC fell over 2 per cent, while TCS, Infosys, HCL Tech, and ICICI Bank also witnessed selling pressure.

In the broader market, the Nifty MidCap index declined 0.2 per cent, while the Nifty SmallCap index slipped 0.07 per cent. Market experts note that Small-Cap and Mid-Cap stocks remain in focus as investors continue to track Quarterly Results, dividend announcements, and corporate actions like IPOs and rights issues.

Among sectoral indices, the Nifty FMCG and Nifty IT indices were the worst performers, both falling over 1 per cent. Bank, Financial Services, Realty, and Oil & Gas also saw weakness. In contrast, Nifty Auto gained more than 1 per cent, followed by Pharma, Healthcare, Consumer Durables, Metal, and Media, showing selective buying interest in Large-Cap and mid-cap counters.

Market Update at 9:40 AM: India’s equity benchmarks opened higher on Friday, supported by government tax cuts, a cooling U.S. labor market, and dovish comments from Federal Reserve officials that reinforced expectations of a rate cut this month.

The NSE Nifty 50 was up 0.34 per cent at 24,818.85, while the BSE Sensex gained 0.36 per cent to 81,012.42 as of 9:15 a.m. IST. Fifteen of the 16 major sectors registered gains in early trade. Broader indices also reflected positive sentiment, with the Nifty Smallcap rising 0.2 per cent and the Nifty Midcap advancing 0.3 per cent.

In the previous session, both the Nifty 50 and the Sensex rose, led by auto and consumer stocks. The rally came after the Goods and Services Tax Council approved a transition to a two-rate structure and announced cuts in levies on everyday goods, a move expected to stimulate demand.

Globally, Asian markets followed Wall Street higher after softer U.S. labour data and dovish remarks from Federal Reserve officials boosted hopes of a rate cut. Money markets are now pricing in an almost 100 per cent probability of a rate cut at the Fed’s upcoming policy meeting in two weeks. Lower U.S. rates generally make emerging markets like India more attractive to foreign investors.

Pre-Market Update at 7:45 AM: Indian equity markets are expected to start on a positive note on Friday, September 5, supported by global cues and optimism from GST reforms. At 7:14 AM, the GIFT Nifty was trading near 24,882, up 59 points, indicating a higher opening for benchmark indices Sensex and Nifty 50.

On Thursday, September 4, Foreign Institutional Investors (FIIs) remained net sellers, offloading equities worth Rs 106.34 crore. Domestic Institutional Investors (DIIs), on the other hand, were active buyers, purchasing shares worth Rs 2,233.09 crore. Such flows continue to play a key role in the movement of large-cap, mid-cap, and small-cap segments.

The Nifty 50 index ended with a modest gain of 0.08 per cent at 24,734.30, after giving up most of its intraday gains driven by GST reform optimism. The Bank Nifty settled nearly unchanged at 54,075.4. Sector-wise, Auto and FMCG stocks contributed positively, while Oil & Gas, Realty, and Metals declined. Mid-cap and small-cap indices closed lower by nearly 0.7 per cent.

US markets closed in positive territory on Thursday, with the S&P 500 finishing at a record high of 6,502.08, up 0.83 per cent. The Dow Jones Industrial Average gained 350.06 points, or 0.77 per cent, to close at 45,621.29, while the Nasdaq Composite climbed 209.97 points, or 0.98 per cent, to 21,707.69. Meanwhile, US President Donald Trump signed an executive order to implement the US-Japan trade deal. Under the agreement, tariffs on Japanese automobiles will be reduced to 15 per cent from the earlier 27.5 per cent, while many other categories of goods will also see tariff caps at 15 per cent.

Fresh unemployment benefit applications in the US rose more than expected, with jobless claims increasing by 8,000 to 237,000 for the week ending August 30. In Japan, household spending rose 1.4 per cent year-on-year in July, below expectations of 2.3 per cent. However, on a seasonally adjusted monthly basis, spending grew 1.7 per cent, surpassing estimates of 1.3 per cent.

Crude oil prices declined for the third straight session ahead of the OPEC meeting. Brent futures slipped 0.27 per cent to USD 66.81 per barrel, while US WTI futures edged down 0.24 per cent to USD 63.33. Gold continued its upward momentum, rising 0.2 per cent to USD 3,552.66 per ounce. The yellow metal is on track for a 3 per cent weekly gain, the strongest since mid-June, as investors sought safe-haven assets amid global trade concerns.

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Disclaimer: The article is for informational purposes only and not investment advice.