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The domestic equity benchmarks traded with significant losses in early trade. The Nifty traded below the 19,550 level. Except the FMCG and consumer durable stocks, shares across sectors declined with autos, banks and metals falling the most.
The barometer index, the S&P BSE Sensex, was down 329.62 points or 0.50% to 65,489.79. The Nifty 50 index lost 111.70 points or 0.57% to 19,526.60.
In the broader market, the S&P BSE Mid-Cap index fell 0.23% while the S&P BSE Small-Cap index added 0.12%.
The market breadth was almost even. On the BSE, 1,394 shares rose and 1,350 shares fell. A total of 165 shares were unchanged.
Investor sentiment took a hit after top Federal Reserve officials, including Fed Governor Michelle Bowman, Vice Chair Michael Barr, Fed Chair Jerome Powell, and New York Fed Chief John Williams, have indicated their willingness to support an increase in the federal funds rate if economic data suggests a sluggish approach towards the central bank's 2% inflation target.
Despite considerable progress, these officials agreed that inflation remains elevated, hinting at the possibility of further rate increases. The current policy rate stands between 5.25% and 5.50%.
They also underscored the need for a restrictive monetary policy over an extended period to achieve their objectives.
Economy:
The gross GST revenue for September rose 2.2 per cent to Rs 1,62,712 crore from Rs 1,59,069 crore in August.Out of the Rs 1,62,712 crore GST collections for September, CGST was Rs 29,818 crore, SGST was Rs 37,657 crore, IGST was Rs 83,623 crore (including Rs 41,145 crore collected on import of goods) and cess was Rs 11,613 crore (including Rs 881 crore collected on import of goods).
It is for the fourth time that the gross GST collection has crossed Rs 1.60 lakh crore mark in 2023-24.
The gross GST collection for the first half of 2023-24 ending September (Rs 9,92,508 crore) is 11 per cent higher than the gross GST collection in the first half of 2022-23 (Rs 8,93,334 crore).
The Reserve Bank of India's (RBI's) six-member Monetary Policy Committee (MPC) will meet from Wednesday to Friday this week. The decision of the MPC will be announced by Das on Friday.
As per media reports, there could be divergence within the RBI's MPC as to the stance of the monetary policy, though unanimity on not changing the repo rate from the current 6.5 per cent is expected to be maintained. In the previous MPC meeting held from August 8-10, the members unanimously decided to retain the repo rate at 6.5 per cent, while there was on divergent view on the withdrawal of accommodation stance.
Stocks in Spotlight:
Vedanta advanced 2.40%. The company on Friday announced the creation of independent verticals through demerger of various companies, mainly its metals, power, aluminium, and oil and gas businesses to unlock value. The demerger will result in the formation of six separate companies, and each will be listed.
Coal India (CIL) shed 0.81%. CIL produced about 333 million tonnes (MTs) of coal ending first half of the current financial year posting a strong 11.3% year-on-year growth. Output for the month of September 2023 was 51.4 MTs, a 5.8 MTs jump or a growth of 12.6%.
Tata Motors declined 0.72%. The company has announced that its total domestic sales in September 2023 stood at 82,023 vehicles, a growth of 2%. Tata Motors sales in the domestic & international market for Q2 FY 2023-24 stood at 2,43,024 vehicles, compared to 2,43,387 units during Q2 FY 2022-23.
Mahindra & Mahindra (M&M) rose 0.72%. M&M announced that its overall auto sales for the month of September 2023 stood at 75,604 vehicles, a growth of 17%, including exports. M&M's Farm Equipment Sector (FES) said domestic tractor sales were at 42,034 units in September 2023, as against 47,100 units during September 2022.
Numbers to track:
The yield on India's 10-year benchmark federal paper rose 0.32% to 7.233 from its previous close of 7.238.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.2050, compared with its close of 83.0650 during the previous trading session.
MCX Gold futures for 5 October 2023 settlement declined 1.57% to Rs 56,209.
The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.20% to 107.12.
The United States 10-year bond yield advanced 0.02% to 4.688.
Global markets:
Asian stocks are trading lower on Tuesday after Federal Reserve officials cemented the view that U.S. interest rates are likely to remain elevated for some time, while the yen slid to near a one-year low, putting traders on watch for intervention from Japanese authorities. Chinese markets are closed for the week because of the Golden Week Holiday.
US stocks ended on a mixed note on Tuesday. U.S. Federal Reserve officials said that monetary policy will need to stay restrictive for some time to bring inflation back down to the Fed's 2% target.
The World Bank forecasts growth in in the developing East Asia and Pacific region to remain strong at 5% in 2023. However, its expects growth to ease in the second half of 2023 and fall to 4.5% in 2024, according to its regional update published on Sunday.
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