Indian stock market set to open lower amid concerns over US inflation

Indian market to open lower: Indian shares are set to open lower on Wednesday, following the trend of Asian markets, as hotter-than-anticipated US inflation data raised concerns about potential delays in interest rate cuts, dampening market sentiment.

As of 8:09 am, GIFT Nifty was trading at 21,621.50, indicating an opening below Tuesday's close of 21,743.25 for the NSE Nifty 50.

Asian markets commenced trading on a downward trajectory, while Wall Street equities registered declines overnight in response to data revealing that US inflation moderated less than expected in January. 

The development heightened apprehensions among investors regarding the timing of Federal Reserve rate adjustments.

The benchmark indexes, the NSE Nifty 50 and BSE Sensex, experienced a volatile start to the week. After a 0.75 per cent decline on Monday, they rebounded by 0.5 per cent each on Tuesday, partially recovering from earlier losses.

Prashant Tapse, senior vice president of research at Mehta Equities, noted that Tuesday's market gains were primarily attributed to the recovery in banking stocks, which had faced downward pressure due to mixed financial earnings and indications of potential rate cut delays from central banks.

Analysts anticipate continued volatility in the market, driven by stretched valuations triggering profit booking activities.

Profit booking has been notably observed in the broader small-cap and mid-cap segments, with declines of 2.39 per cent and 1.51 per cent respectively in February, compared to a marginal 0.08 per cent rise in the Nifty 50.

Foreign Portfolio Investors (FPIs) have offloaded shares worth Rs 2,524 crore in February, following January's sell-off of stocks amounting to Rs 25,744 crore, according to data from the National Securities Depository. 

Conversely, Domestic Institutional Investors (DIIs) maintained their buying streak for the seventh consecutive month, purchasing stocks worth Rs 274 crore on Tuesday.

Key earnings releases on Tuesday included Mahindra & Mahindra, NMDC, and Gland Pharma.

Stocks to watch 

Oil India: It posted a fall in December quarter profit on lower crude prices.

Sula Vineyards: It reported higher third-quarter profit on strong premium wine demand.

Bharat Electronics: It won orders worth 22.82 billion rupees from India's Defence Ministry for supply of electronic warfare suites.

Wipro: It acquired US-based Aggne Global Inc. for $66 million, to strengthen its consulting and services capabilities in the insurance sector.

(With Reuters Inputs)