Indian stocks marginally dipped on Tuesday following a turbulent trading session. This oscillation was largely influenced by rising geopolitical tension in the Middle East as well as the ambiguous trajectory of U.S. interest rate cuts.
The geopolitical tension escalated due to an incident where a prominent Iranian military commander and multiple diplomats were killed. The attack, reportedly an Israeli airstrike, targeted an Iranian consulate in Damascus. Iran has since pledged to retaliate, increasing concerns about a potential extensive Middle Eastern conflict.
Investors are eagerly awaiting more data from the U.S., including the highly-anticipated U.S. jobs report. Statements from several Federal Reserve (Fed) officials for further clarity on when interest rates might be cut are also expected.
Jerome Powell, the Fed Chair, is due to speak on Wednesday. His speech is eagerly awaited, especially in the light of robust U.S. factory activity data, and the increasing component prices as indicated in the Institute for Supply Management (ISM) report. The report stirred anxieties about persistent inflation and dampened hopes for potential interest rate cuts in June.
Meanwhile, domestically, the Reserve Bank of India's rate-setting panel's inaugural policy meeting for Fiscal Year 2025 is scheduled from April 3-5, 2024. A status quo on rates is expected considering the backdrop of robust growth and inflation consistently surpassing the Monetary Policy Committee's targets.
The standard S&P BSE Sensex concluded the session 110.64 points lower, a 0.15 percent decrease, settling at 73,903.91 after recording a low of 73,743.77 earlier in the day. However, the broader NSE Nifty index regained most initial losses, closing with a marginal decrease of 8.70 points at 22,453.30.
The Nifty pack saw a 1-2 percent fall in certain stocks, such as SBI Life, ICICI Bank, HCL Technologies, Kotak Mahindra Bank, and Hero MotoCorp. On the other hand, Adani Ports, Bajaj Auto, BPCL, Mahindra and Mahindra, and Tata Consumer Products saw a 2-4 percent surge.
