surrendered a chunk of the previous session’s gains on Wednesday as a sharper-than-expected jump in and hovering above $107 a barrel kept investors cautious ahead of US inflation data due later in the day.
The closed at 22,622.70, down 99.25 points or 0.44 per cent, while the fell 251.89 points to end at 72,781.89. Bank Nifty settled at 55,316, down 165.05 points or 0.30 per cent. The Nifty Midcap 100 declined 0.08 per cent and the Nifty Smallcap 100 fell 0.32 per cent.
“A hotter-than-expected domestic WPI print pushed bond yields higher, reviving concerns over a tighter monetary policy trajectory and weighing on automobiles, private banks and metals,” said Vinod Nair, Head of Research at Geojit Investments.
India’s wholesale price inflation accelerated to 11.39 per cent year-on-year in September from 9.92 per cent in August, driven by higher fuel, food and manufactured-product prices.
Retail inflation also rose to 5.54 per cent, indicating that price pressures are broadening beyond consumers to producer and input costs, raising the risk of margin compression for companies unable to pass on higher expenses.
Brent crude held above $107 a barrel, with fresh Gulf attacks and reports that Tehran plans to escalate tanker strikes near the Strait of Hormuz sustaining the supply-risk premium.
MCX crude rose over 1 per cent, crossing the ₹9,000 mark. The IEA cautioned that a Russian diesel supply arrangement was unlikely to materially alter the overall balance, limiting any downside pressure on prices.
Nifty IT gained 1.1 per cent, extending the buying that followed HCLTech’s better-than-expected quarterly results. Nifty FMCG rose 1.21 per cent and Oil & Gas added 1 per cent.
Nifty Pharma was the weakest sector, falling 1.30 per cent amid regulatory uncertainty around medicine pricing after the Supreme Court questioned the scope of trade-margin controls. Auto, metals and realty also ended lower, limiting any recovery in the benchmarks.
The Indian rupee extended its gains as the dollar slipped below the ₹95 mark, supported by the RBI’s recent measures to limit speculative activity and redirect oil-related dollar demand away from the spot market. Spot gold eased to around $4,140 an ounce and silver fell over 1 per cent to $58.4.
“The near-term direction depends on today’s CPI and on Fed Chair Warsh’s remarks at the IMF meetings in Bangkok on Friday… a hotter print would strengthen the higher-for-longer case, lifting the dollar and yields and pressuring metals,” said Kaynat Chainwala, AVP Commodity Research at Kotak Neo, adding that a soft reading could push gold back above $4,200.
On the small-cap front, Chandraprakash Padiyar, Senior Fund Manager at Tata Asset Management, noted that “…the next phase could be shaped by a smaller set of companies that are able to translate opportunities into earnings,” with manufacturing among the long-term themes the firm continues to track.
Looking ahead, markets will take their cue from tonight’s US CPI print, followed by UK GDP, US PPI and retail sales on Thursday. On the earnings front, Nestlé India, Wipro, Tech Mahindra, Jio Financial Services and Polycab are scheduled to report second-quarter results Thursday.