GIFT Nifty:

The GIFT Nifty October futures contract is up 34.50 points, suggesting a positive start for the Nifty 50.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 9,791.93 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 6,645.80 crore in the Indian equity market on 30 September 2024, provisional data showed.

FPIs bought shares worth 15423.32 crore in September 2024.

Economy:

India's fiscal deficit remained under control during April-August, reaching 27% of the full-year target. This containment was attributed to muted spending in the early months of the fiscal year. The government's spending has been lower due to general elections. In comparison, the deficit stood at a higher 36% during the same period in FY24.

Global Markets:

Asian stocks retreated slightly from their recent two-and-a-half-year peaks on Tuesday. This followed hawkish comments from Federal Reserve Chair Jerome Powell, which dampened expectations for aggressive interest rate cuts. The U.S. dollar strengthened in response. Meanwhile, heightened tensions in the Middle East added to market uncertainty.

With mainland China's financial markets closed for the remainder of the week, the recent rally in Asian markets is expected to pause. Hong Kong's Hang Seng is also closed on Tuesday.

U.S. equities closed higher on Monday, recovering from earlier losses triggered by Powell's remarks. The Dow Jones Industrial Average rose by 0.04% to a record closing high of 42,330.15. The S&P 500 gained 0.42% to also reach a new record close of 5,762.48. The Nasdaq Composite added 0.38%.

Investors had anticipated more aggressive rate cuts from the Federal Reserve in its final two meetings of the year. However, Powell indicated that the central bank would likely stick to quarter-point rate reductions moving forward, citing recent economic data that showed strong growth and consumer spending.

Domestic Market:

Domestic equity benchmarks experienced a sharp decline Monday, mirroring global trends, as tensions in the Middle East escalated. The Nifty50 closed below 25,850, with sectors like auto, banking, and finance bearing the brunt of the sell-off. However, metals and media stocks bucked the trend. Global investors are closely watching US economic data, particularly the jobs report, which could influence the Fed's interest rate decisions. While China's market saw a rebound due to stimulus measures, India's premium valuation and global pressures weighed on its performance. Domestically, investors are looking forward to Q2 earnings reports, hoping for a reversal after a weak Q1.

The S&P BSE Sensex, tanked 1,272.07 points or 1.49% to 84,299.78. The Nifty 50 index dropped 368.10 points or 1.41% to 25,810.85.

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