Stock market on January 8: Equity benchmark indices opened flat in early trade on Wednesday amid mixed global cues. In the early trade, the 30-share BSE Sensex climbed 11.57 points to 78,210.68. Meanwhile, the Nifty was also marginally up by 4.05 points to 23,711.95.
Global factors, including higher benchmark Treasury yields, unexpectedly strong US services sector activity in December, and a surge in new job openings despite slower hiring, have contributed to reduced expectations of Federal Reserve rate cuts. These developments pulled Wall Street benchmarks lower in overnight trading, creating a cautious atmosphere for investors in India.
Domestic sentiment is also under pressure after the National Statistics Office (NSO) estimated India’s economic growth to slow to 6.4% in FY25, falling below the Reserve Bank of India’s (RBI’s) projection of 6.6%. This marks a decline from the 8.2% GDP growth recorded in FY24.
Rupee against dollar
The rupee depreciated 9 paise to hit its record low of 85.83 against the US dollar in early trade on Wednesday as strengthening American currency and higher crude oil prices continued to play spoilsports even as the government lowered the country's economic growth projection.
According to analysts, subdued domestic equity markets also weighed on the Indian currency even as better growth prospect in the US economy fuelled the expectations of delayed interest rate cut by the Federal Reserve, leading to a record rise in the US Treasury yields as well as dollar demand. The latest government data released on Tuesday showed India's economic growth rate is estimated to slip to a four-year low of 6.4 per cent in 2024-25 due to poor show by the manufacturing and services sectors.
(With PTI inputs)
