Domestic shares are likely to open higher on Wednesday, tracking Asian peers, while top private lender HDFC Bank will be in focus on hopes of a likely increase in its weightage in a key global index.
The GIFT Nifty was trading at 24,326 as of 8:22 a.m. IST, indicating the Nifty 50 will open above Tuesday’s close of 24,123.85.
Both the Nifty and S&P BSE Sensex erased early gains in the previous session to end flat. They added about 7% each in June, their best month yet in 2024.
“After the solid bull run in markets, now HDFC Bank is set to give another boost,” said Abhilash Pagaria, head of Nuvama Alternative and Quantitative Research.
Foreign institutional investors’ shareholding in HDFC Bank in the June quarter dropped below the threshold 55%, data released post market hours on Tuesday showed, raising the possibility of a likely increase in weightage in global index provider Morgan Stanley’s MSCI indexes.
“A weight increase could bring in $3.2 billion-$4 billion inflows over six days,” Nuvama’s Pagaria said.
Inflows into HDFC Bank could further boost the benchmarks as it is the heaviest weighted stock in the Nifty and Sensex.
Meanwhile, Asian markets opened higher, tracking overnight gains in Wall Street, after US Federal Reserve Chair Jerome Powell noted progress in reining in inflation in the country.
Powell also said policymakers need more data before cutting rates to verify that recent soft inflation readings provide an accurate picture of the U.S. economy.
The odds of a 25 basis point rate cut in September rose marginally to 61.5% from 59.8% ahead of Powell’s comments, according to CME’s FedWatch tool.
Domestic investors bought Indian shares worth ₹648 crore ($77.6 million) on a net basis on Friday, while foreign investors net sold stocks worth ₹2,000 crore, per exchange data.
STOCKS TO WATCH:
Yes Bank: Private lender posts 14.8% year-on-year growth in loans and advances in June quarter, according to provisional data.
Avenue Supermarts: Company says standalone revenue from operations grew 18.4% to ₹13,712 crore in June quarter.
Mahindra & Mahindra Financial Services: Company posts 5% growth in June quarter disbursements.
KEC International: Company secures orders worth ₹1,017 crore.
($1 = 83.4940 Indian rupees)
