Nifty 50, Sensex End Flat; M&M, Bajaj Finance Drag; US Inflation Data in Focus

On Thursday, July 11, the Indian stock market benchmarks, the Sensex and the Nifty 50, closed flat. Gains in shares of ITC, ONGC, Tata Motors, and SBI were offset by losses in Mahindra and Mahindra (M&M), Bajaj Finance, Larsen and Toubro (L&T), and HDFC Bank.

The benchmark indices exhibited sideways movement, continuing a trend of selective stock picking while booking profits in others. Experts noted that the market is struggling to break out of its range due to a lack of fresh triggers, and this trend is likely to persist until the Budget announcement on July 23.

A significant focus for the market was the upcoming US Consumer Price Index (CPI) data, which is expected to influence expectations of rate cuts by the US Federal Reserve. Fed Chair Jerome Powell, in his testimony to Congress on Wednesday, emphasized the need for more data before the central bank could start cutting rates.

The Nifty 50 closed nearly 9 points, or 0.03 percent, lower at 24,315.95, while the Sensex settled 27 points, or 0.03 percent, down at 79,897.34.

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The top five Nifty movers were ITC, ONGC, Tata Motors, SBI, and Coal India. Conversely, Mahindra and Mahindra, Bajaj Finance, L&T, HDFC Bank, and ICICI Bank emerged as the top five drags on the index.

Despite the flat performance of the benchmark indices, the BSE Midcap and Smallcap indices outperformed, rising by 0.34 percent and 0.57 percent, respectively. The overall market capitalization of firms listed on the BSE increased to nearly ₹451.3 lakh crore from nearly ₹450.1 lakh crore in the previous session, making investors richer by over ₹1 lakh crore in a day.

The Nifty Bank index rose by 0.16 percent, while the PSU Bank and Private Bank indices moved up by 0.17 percent and 0.16 percent, respectively.

Vinod Nair, Head of Research at Geojit Financial Services, commented on the market’s current state, saying, "The main indices are trading in a narrow range, struggling to justify their premium valuation ahead of the Q1 earnings season, which is forecast to be subdued. However, the broader market is exhibiting marginal momentum, led by a shift in FIIs inflow and Budget expectations. Attention is now focused on the US inflation data, which is estimated to moderate and positively influence the Fed's interest rate decisions."

Shrikant Chouhan, Head of Equity Research at Kotak Securities, provided technical insights, stating, "For the bulls, the immediate breakout zone is 24,400/80,150. Above this level, the market could rally up to 24,500-24,575/80,500-80,700. On the flip side, below 24,200/79,470, selling pressure is likely to accelerate, potentially causing the market to slip to 24,100-24,075/79,100-79,000."

As market participants await the US CPI data and the upcoming Budget announcement, the Indian stock market continues to navigate a period of cautious optimism and selective investment.