Nifty Opens Steady; L&T Gains, Tata Motors Slips on M&A Buzz
The Indian stock market opened flat on Monday, with traders awaiting cues from the Federal Reserve’s monetary policy meeting and India-US trade talks. The Nifty 50 index traded near 24,860, with a rangebound sentiment expected to prevail in the near term.
Larsen & Toubro (L&T) shares surged 4% after the company reported strong earnings, boosting the stock’s overall performance. On the other hand, Tata Motors slid 3% following reports of a potential buyout of its Iveco business.
The Indian market’s flat opening was attributed to the lack of significant news or economic indicators, with traders preferring to wait for cues from the Federal Reserve’s meeting and India-US trade talks. The Fed is expected to provide guidance on its monetary policy, which could impact the global markets and, in turn, the Indian stock market.
The Nifty 50 index, which tracks the performance of 50 large-cap stocks, opened at 24,860 and traded in a narrow range of 24,680-24,920. The index is expected to remain rangebound in the near term, with analysts predicting a trading range of 24,680-24,920.
The Indian market has been volatile in recent weeks, with the Nifty index oscillating between 24,500 and 25,000. The volatility is attributed to a combination of factors, including the ongoing trade tensions between the US and China, the impact of the COVID-19 pandemic on the global economy, and the uncertainty surrounding the Indian government’s economic policies.
L&T shares surged 4% after the company reported strong earnings, with the stock’s performance driven by its diversified business segments and robust order book. The company reported a consolidated net profit of ₹2,133 crores in the quarter ended June 30, compared to ₹1,833 crores in the corresponding quarter last year.
Tata Motors, on the other hand, slid 3% following reports of a potential buyout of its Iveco business. The company is in talks with several potential buyers, including the Russian state-owned corporation Rostec, to sell its Iveco business. The sale is expected to help Tata Motors reduce its debt and focus on its core business of passenger and commercial vehicles.
The Indian market’s M&A activity has been picking up pace in recent weeks, with several companies announcing deals worth billions of dollars. The government’s efforts to promote foreign direct investment (FDI) and ease regulatory norms have contributed to the increase in M&A activity.
In addition to the potential Iveco buyout, Tata Motors is also exploring options to divest its stake in its joint venture with Fiat Chrysler Automobiles (FCA). The joint venture, which operates under the brand name Fiat India Automobiles, has been struggling to gain traction in the Indian market.
The Indian market’s FII (foreign institutional investor) inflows have been sluggish in recent weeks, with FIIs selling Indian stocks worth ₹12,000 crores in the week ended July 24. The selling pressure is attributed to the ongoing trade tensions between the US and China, which has led to a rise in market volatility.
The MSCI rebalancing, which is scheduled to take place on August 31, is also expected to fuel near-term volatility in the Indian market. The rebalancing process, which is conducted quarterly, aims to ensure that the MSCI indices remain representative of the global stock market.
In conclusion, the Indian stock market opened flat on Monday, with traders awaiting cues from the Federal Reserve’s monetary policy meeting and India-US trade talks. L&T shares surged 4% after the company reported strong earnings, while Tata Motors slid 3% following reports of a potential Iveco buyout. The Indian market is expected to remain rangebound in the near term, with analysts predicting a trading range of 24,680-24,920.
Source:
https://stocktwits.com/news-articles/markets/equity/nifty-sensex-open-steady-july-30/choQYNdR5yC
