Nifty Flatlines, Sensex Edges Up In Early Trade as Investors Eye Middle East Diplomacy

Mumbai, Aug 6: Indian equity benchmarks inched up in early trade on Thursday, extending Wednesday’s gains as investors monitored Middle East diplomacy and processed positive economic commentary from the central bank yesterday.

The BSE Sensex was trading at 78,723.80, up 142.80 points or 0.18 per cent, while the NSE Nifty 50 stood at 24,628.75, up 4.10 points or 0.02 per cent, as of 9:38 am. This comes a day after both benchmarks ticked up in a session that saw the new Closing Auction Session (CAS) mechanism erase the Nifty’s intraday losses in the final minutes of trade. Both benchmarks are diverging ever since the new close mechanism was put in place.

The Reserve Bank of India’s decision on Wednesday to keep the repo rate unchanged at 5.25 per cent was expected. The central bank retained its neutral policy stance, signalling it would stay data-dependent as it tracks the impact of elevated oil prices and evolving inflation trends. The RBI also marginally raised its FY27 GDP growth forecast to 6.7 per cent while trimming its inflation projection to 5 per cent, citing resilient domestic demand. On the global front, Wall Street ended Wednesday on a mixed note, with the Dow Jones Industrial Average adding 0.49 per cent and the NYSE Composite up 0.21 per cent, even as the Nasdaq Composite slipped 0.83 per cent on weakness in technology names and the S&P 500 eased 0.17 per cent. The other major swing factor for Indian markets remains the evolving Iran-Oman talks over the Strait of Hormuz. Reports of progress in negotiations that could give Tehran a degree of control over shipping through the strait have kept crude oil prices on the back foot, a dynamic that is broadly favourable for India as a large net oil importer.

Gainers & Losers 

Among individual stocks, five names led the gainers’ list on the Nifty on Thursday morning. Cipla (CIPLA) topped the chart, rising 1.38 per cent to an LTP of Rs 1,479 from a previous close of Rs 1,458.8. Reliance Industries (RELIANCE) followed with a 1.31 per cent gain to Rs 1,296.8 against its previous close of Rs 1,280. Titan Company (TITAN) advanced 1.28 per cent to Rs 4,975.5 from Rs 4,912.4, while Eternal (ETERNAL) rose 1.27 per cent to Rs 314.3 from Rs 310.35. Jio Financial Services (JIOFIN) rounded off the top five gainers, up 0.86 per cent to Rs 264.2 from Rs 261.95.  

On the losing side, Power Grid Corporation of India (POWERGRID) was the steepest decliner, falling 2.79 per cent to Rs 273.9 from a previous close of Rs 281.75. Trent (TRENT) slipped 1.84 per cent to Rs 3,071.3 from Rs 3,129, while Hindalco Industries (HINDALCO) declined 1.05 per cent to Rs 1,029.1 from Rs 1,040. NTPC (NTPC) eased 0.93 per cent to Rs 346.65 from Rs 349.9, and Tata Motors Passenger Vehicles (TMPV) rounded off the top five losers, down 0.84 per cent to Rs 346.85 from Rs 349.8. 

Broad Market & Sectoral Indices 

Among broad market indices, the Nifty Smallcap 50 led the gainers, up 0.62 per cent, followed by the Nifty Microcap 250, higher by 0.56 per cent, the Nifty Smallcap 100, up 0.33 per cent, and the Nifty Smallcap 500, gaining 0.28 per cent. On the losing side, the Nifty Midcap 100 slipped 0.18 per cent, the Nifty Midcap 150 fell 0.16 per cent, the Nifty Midcap Select was down 0.10 per cent, and the Nifty LargeMidcap 250 eased 0.07 per cent.  

Among sectoral indices, the Nifty Chemicals index gained the most, up 0.65 per cent, followed by the Nifty Consumer Durables index, higher by 0.54 per cent, the Nifty PSU Bank index, up 0.47 per cent, and the Nifty Pharma index, gaining 0.41 per cent. On the downside, the Nifty Realty index led the laggards, down 0.75 per cent, followed by the Nifty Auto index, lower by 0.54 per cent, the Nifty Media index, down 0.24 per cent, and the Nifty Midsmall IT & Telecom index, which slipped 0.18 per cent. 

Middle East Conflict 

A proposed deal between Iran and Oman would give Tehran control over ships entering the Gulf through the Strait of Hormuz, sources told Reuters, marking one of the biggest concessions to Iran since the war with the US and Israel began in February. Iran is seeking fees of 5 to 7 per cent on cargo values for ships using the strait, against Oman’s proposal of around 3 per cent and Washington’s insistence on no fees at all. Significant issues remain unresolved, including how ships travelling out of the Gulf would be treated, even as Iranian officials said talks with Oman had reached fundamental understandings and were close to being finalised. Iran has reported more than 3,400 deaths since the conflict began, against 18 US military personnel killed, with President Donald Trump saying he would prefer a negotiated settlement even as U.S. officials have insisted they would never cede control of the strait to Tehran. 

Asian Markets on Thursday Morning 

Asian markets were mixed on Thursday morning, with Japan’s Nikkei 225 falling 1.70 per cent and Hong Kong’s Hang Seng sliding 1.87 per cent, tracking unease over the region’s growth outlook. Australia’s All Ordinaries and Malaysia’s FTSE Bursa KLCI both rose 0.57 per cent, while Pakistan’s KSE 100 jumped 1.66 per cent and China’s Shanghai Composite edged up 0.19 per cent. The divergence across the region reflects investors weighing progress in the Iran-Oman talks against lingering caution over the broader Middle East conflict. 

US Markets 

US markets ended Wednesday on a mixed note, with the Dow Jones Industrial Average rising 0.49 per cent to 54,349.12 and the NYSE Composite adding 0.21 per cent, even as the Nasdaq Composite slipped 0.83 per cent to 26,363.44 on weakness in technology names. The S&P 500 eased 0.17 per cent to 7,723.55, while Canada’s S&P/TSX Composite outperformed with a 0.96 per cent gain. The broadly firm close on Wall Street has offered some support to sentiment in Asia and India through Thursday’s session. 

Oil Prices 

Oil prices eased on Thursday, with WTI crude down 0.20 per cent at $75.07 a barrel and Brent crude slipping 0.11 per cent to $79.36 a barrel, even as Murban crude bucked the trend to rise 1.41 per cent to $77.94 a barrel. The pullback in WTI and Brent came as investors assessed whether progress in the Iran-Oman talks could pave the way for a broader US-Iran peace deal and a reopening of the Strait of Hormuz. Softer crude prices are a modest positive for India’s import bill and inflation outlook, reinforcing the RBI’s more comfortable stance on price pressures. 

Wednesday’s Close 

Indian benchmark indices ticked higher on Wednesday after the new Closing Auction Session erased the Nifty’s losses and the RBI left rates unchanged as expected. The BSE Sensex rose 0.19 per cent to close at 78,581, while the NSE Nifty 50 gained 0.04 per cent to settle at 24,624.65. The Nifty had traded lower before the Closing Auction Session reversed its losses in the final minutes of trade, with gains in metal and auto stocks helping support sentiment even as caution persisted amid lingering global uncertainties.  

Sources

• bseindia.com
• nseindia.com