Indian Stock Market Falls as Investors Await US Inflation Data
New Delhi [India], September 11: Indian stock indices closed Wednesday in the red, with a broad-based fall across sectors like media, metal, PSU bank, realty, oil, and gas. Analysts noted that profit booking at higher levels also dampened investor sentiment.
At the closing, Sensex was at 81,523.16 points, down 398.13 points or 0.49%, and Nifty was at 24,918.45 points, down 122.65 points or 0.49%.
Vinod Nair, Head of Research at Geojit Financial Services, said, “The domestic market experienced a minor consolidation in line with Asian peers due to the correction of commodity prices. Market sentiment remained cautious due to the slowdown in the Chinese economy. Investors await the release of the US CPI and domestic inflation data.”
Shrikant Chouhan, Head of Equity Research at Kotak Securities, added, “Today, the benchmark indices witnessed profit booking at higher levels.”
Earlier this week, domestic stock indices rose substantially, possibly due to strong market fundamentals and continued buying by foreign portfolio investors (FPIs), which cushioned the indices from relative weakness in the US market.
Going forward, the markets will monitor both retail and wholesale inflation data for fresh cues. Retail inflation in India softened to 3.54% in July, according to data from the Ministry of Statistics and Programme Implementation. The RBI has raised the repo rate by 250 basis points since May 2022 to combat inflation.
Later this week, investors are likely to remain cautious ahead of the crucial US inflation report for August, which could influence the Federal Reserve’s upcoming monetary policy decision.
Doubts Revealed
Stock Market -: A stock market is a place where people buy and sell shares of companies. It’s like a big marketplace for company ownership.
Sensex -: Sensex is a stock market index in India that shows the performance of 30 major companies listed on the Bombay Stock Exchange (BSE).
Nifty -: Nifty is another stock market index in India, but it tracks 50 major companies listed on the National Stock Exchange (NSE).
Profit Booking -: Profit booking means selling shares to take advantage of the gains made when the stock prices have gone up.
CPI -: CPI stands for Consumer Price Index. It measures the average change in prices paid by consumers for goods and services over time.
Repo Rate -: The repo rate is the interest rate at which the Reserve Bank of India (RBI) lends money to commercial banks. It helps control inflation and the money supply in the economy.
Basis Points -: Basis points are a unit of measure used in finance to describe the percentage change in interest rates or other financial percentages. One basis point is equal to 0.01%.
RBI -: RBI stands for Reserve Bank of India. It is the central bank of India, responsible for regulating the country’s currency and monetary policy.