Shares Edge Up At Pre-Open Signalling Higher Start After Selloff

Mumbai, September 16: Indian shares edged up at pre open signalling a higher start for benchmarks after selloff even as oil and yields remained elevated ahead of the Federal Reserve’s rate decision later today.   

Nifty 50 rose 0.14% and Sensex advanced 0.15% at pre open.   

Three initial public offerings — Hero Motors, SS Retail and Jindal Supreme India — are set to open for subscription on Wednesday, taking the number of IPOs currently accepting bids to four. 

The fresh issues come against a backdrop of heightened volatility in the equity market. Indian benchmarks had started Tuesday’s session with gains of around 0.8%, but the early optimism faded as selling intensified, leaving both the Sensex and Nifty more than 1% lower each at the close.  

Foreign institutional investors were heavy sellers, pulling out Rs 2,978 crore from Indian equities on Tuesday, their biggest single-day outflow since September 4.  

Domestic institutional investors, however, provided a counterweight, buying shares worth a net Rs 2,686 crore, according to provisional NSE data.  

Paytm and Pine Labs shares could gain after NPCI announced a 0.4% merchant discount rate on select person-to-merchant UPI transactions above Rs 2,000, effective October 15. The move is expected to alter the economics of high-value UPI merchant payments.  

NBCC, a state-owned construction company, secured orders worth Rs 145 crore from clients including North Eastern Electric Power Corporation (NEEPCO) and Steel Authority of India (SAIL).  

BHEL entered into an equal 50:50 joint venture with Titagarh Rail Systems to undertake maintenance of Vande Bharat sleeper trainsets. 

Asian Markets 

Asian shares were mixed on Wednesday as investors remained cautious ahead of the Federal Reserve’s policy decision, while concerns over elevated oil prices and higher US bond yields continued to weigh on sentiment. 

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2%, while South Korea’s Kospi gained 0.4%. Japan’s Nikkei edged down 0.14%, while Hong Kong’s Hang Seng slipped 0.06%. 

The mixed performance followed a weaker session on Wall Street, where investors assessed the impact of higher Treasury yields, rising oil prices and renewed concerns around the outlook for artificial-intelligence stocks. 

Market attention remains focused on the Federal Reserve, with investors looking for signals on the interest-rate path and the central bank’s assessment of inflation and economic growth. Elevated US yields have increased pressure on risk assets and could weigh on foreign flows into emerging markets. 

US Markets 

US stocks ended lower on Tuesday, with the S&P 500 declining 0.4%, the Nasdaq Composite losing 0.8% and the Dow Jones Industrial Average falling 0.6%. 

Stocks came under pressure as investors assessed higher Treasury yields and renewed concerns around the pace and risks of artificial-intelligence development. Comments from AI executives calling for a slower pace of development amid concerns over the technology’s risks added to caution around technology stocks. 

US stock futures were marginally higher on Wednesday, with S&P 500 E-mini futures gaining 0.14%, offering a mildly supportive cue for Indian equities. However, the limited gains suggest that investors remain cautious ahead of the Fed decision. 

The benchmark 10-year US Treasury yield moved above 5% on Tuesday, its highest level since 2007, before easing to around 4.99% in Asian trade. Higher yields can put pressure on equity valuations and reduce the relative attractiveness of emerging-market assets. 

Oil Prices 

Crude oil remains a key risk for global markets, with Brent crude trading around $108 a barrel on Wednesday after easing from the previous session’s gains. 

The retreat followed an unexpected rise in US crude inventories, but concerns over disruptions to global supplies continued to support prices. Saudi Arabia suspended some oil loadings after an attack disrupted its East-West pipeline, while production at three Libyan oil fields was also halted amid protests. 

For India, crude prices above $100 a barrel remain a significant headwind given the country’s dependence on imported oil. Sustained high energy prices can add to inflationary pressures, widen the trade deficit and weigh on corporate margins, while also affecting the rupee and foreign investor sentiment. 

Source

• Exchanges