Mumbai (Maharashtra) [India] : The stock market started Tuesday on a positive note, opening in the green, even as concerns over rising wholesale inflation persisted.
The Sensex opened with a gain of 312.92 points, reaching 66,479.85, while the Nifty also saw an opening gain of 88.85 points, starting at 19,821.10.
The market’s optimistic start came amid the release of data showing that India’s wholesale inflation, as measured by the Wholesale Price Index (WPI), remained in the deflationary zone for the sixth consecutive month in September, standing at -0.26 per cent.
This marked a rise from the previous month when WPI inflation was -0.52 per cent in August 2023 and significantly lower than the 10.55 per cent recorded in September 2022.
The latest WPI data surprised experts, as it was well below the consensus estimate, with many economists anticipating a rise to 0.7 per cent last month.
This deflationary trend has persisted despite the headline retail inflation falling to a three-month low of 5.02 per cent in September, down 242 basis points from July’s 15-month high of 7.44 per cent.
The WPI data revealed that the food index of the WPI decreased by 4.46 per cent month-on-month (MoM) in September, driven by a sharp decline in tomato prices.
However, most other food items saw a sequential rise in prices, including cereals, pulses, fruits, and milk. Additionally, the fuel and power group of the WPI rose more than 2 per cent MoM.
In the stock market, early trading saw 46 Nifty companies in advances and 4 in declines. The top gainers included Tata Consumer Products, Bajaj Finance, Bajaj Finserv, Power Grid, and Adani Enterprises. In contrast, LT, Divi’s Lab, ONGC, and Britannia started the day as the top losers.
Despite the concerns surrounding inflation, the Nifty was poised to open strongly, supported by a global market rally and the decent financial results posted by HDFC Bank.
Varun Aggarwal, founder and managing director, Profit Idea, said, ‘Broader market looks quite positive. Lot of strength in mid and small-cap stocks. IT, Banks, Media, Metals, and FMCG sectors continue to look strong. Bullish bias strategies on the Index can be opted with defined risk. 19500 has seen massive put writing and the Open Interest (OI) data range remains between 19500-20000. Bulls are creating a good base and this consolidation is good for the market. Picking quality stocks on dips will reward investors handsomely. On the upside, nifty can target 20466-21234-21410. Major support on the downside remains at 18887. Short-term support at nifty is at 19350’.
Despite concerns over inflation, the stock market’s early performance signalled investors’ confidence, as they continued to explore opportunities in a dynamic economic landscape.