Despite negative global cues, Indian markets attempt to stay steady

Nvidia's results have fallen short of market expectations, sparking fears that the tech sector shares might suffer today. The company's growth and profit forecasts have been downgraded, leading to a decline in tech stocks across Asian markets. US futures are significantly down. Both Goldman Sachs and Morgan Stanley have warned of a potential correction in the tech sector.

The approval of the Reliance-Disney merger by the Competition Commission could benefit Reliance and its media companies today, while other media firms might face pressure. Major announcements are expected at the Reliance shareholders' meeting today.

In the derivatives market, the GIFT Nifty closed at 25,006 on Wednesday night and dropped slightly to 25,002 this morning. The Indian market is expected to open lower today, as indicated by these signals.

European, US markets

European markets ended higher on Wednesday.

The US market opened lower on Wednesday and continued to decline, closing with significant losses. The market was anxiously awaiting Nvidia's results.

On Wednesday, the Dow Jones Index fell 159.08 points (0.39%) to close at a record low of 41,091.42. The S&P 500 dropped 33.62 points (0.60%) to 5592.18, while the Nasdaq declined by 198.79 points (1.12%) to close at 17,556.03.

US futures are down today, with the Dow up by 0.12%, while the S&P and Nasdaq are down by 0.56% and 0.99%, respectively. US 10-year bond yields dropped to 3.835%.

Asian markets also opened lower this morning.

Indian markets 

The Indian market was volatile on Wednesday. The Nifty rose to a new record high of 25,129.60 before profit-taking pulled the index down. The Nifty closed in positive territory for the tenth consecutive day.

On Wednesday, the Sensex rose by 73.80 points (0.09%) to close at 81,785.56, while the Nifty gained 34.60 points (0.14%) to end at 25,052.35. The Bank Nifty fell by 0.26% (134.90 points) to close at 51,143.85.

The Mid Cap Index fell by 0.12% to 59,146.40, while the Small Cap Index declined by 0.07% to 19,319.75.

Foreign investors sold shares worth ₹1,347.53 crore in the cash market on Wednesday, while domestic funds and institutions bought shares worth ₹439.35 crore.

The market closed with bullish sentiment, but Western and Asian signals suggest a downward trend.

Today, the Nifty index has support at 24,985 and 24,950, with resistance at 25,110 and 25,150.

NBCC share soar

An announcement regarding a bonus issue at Saturday's board meeting sent NBCC shares soaring by up to 17%. A report that Trent Limited, the operator of Zudio and Westside brand stores, would be included in the Nifty 50 index lifted the stock by up to 7%.

Kotak Securities upgraded Mindtree, which is being removed from the Nifty 50 index, pushing its stock up by 8%. Tata Elxsi dropped 8% following poor evaluations from brokerages.

Nvidia shines, but  stock falls

Nvidia, a leader in AI-focused graphic processing units, delivered strong Q2 results, but they did not meet market expectations. As a result, the stock fell by 7.5% in after-hours trading in the US. Nasdaq 100 futures dropped by 1.2%. During regular trading hours, Nvidia fell by 2.1%, though the stock is still up by 154% over the past year.

Revenue increased by 122% to $3,004 million, exceeding analysts' expectations of $2,870 million. Net income rose by 168% from $618 million to $1,660 million, with earnings per share increasing from 25 cents to 67 cents, compared to analysts' expectations of 64 cents.

While the results were better than analysts' forecasts, they fell short of the market's high expectations. Over the past three quarters, Nvidia's revenue and profits have grown by over 200%, leading the market to expect similar growth this quarter, which did not materialize. The company's profit margins dropped from 78.4% in the previous quarter to 75.1%, and the annual profit margin forecast was also slightly lowered. Nvidia announced that its next-generation AI chip, Blackwell, is expected to generate billions in sales in Q4. The company will also repurchase $5 billion worth of shares.

Reliance-Disney merger

The Competition Commission of India has approved the merger between Viacom 18 and Digital 18 Media, part of the Reliance Group, and the Indian subsidiaries of Walt Disney. The approval was granted after Reliance assured that advertising rates would not be excessively increased. The new joint venture will control over 40% of the television advertising market in India. The company will also secure the digital and television rights for ICC events until 2027 and the IPL broadcasting and streaming rights until 2028.

Reliance will invest ₹11,500 crore in the joint venture, which will have a valuation of ₹70,350 crore. The company will have 120 channels and two streaming services, with Nita Ambani serving as the chairperson of this media giant. Competitors like Sony, Netflix, Amazon, and Zee will face stiff competition from this new entity.

Gold, crude, commodities

Gold remains near-record levels, closing at $2,505.10 per ounce yesterday and rising to $2,513 this morning. The dollar index rose, leading to a dip in gold prices yesterday, but the market expects prices to rise further.

December futures prices dropped to $2,533 per ounce but climbed this morning.

Gold prices in Kerala rose by ₹160 yesterday, reaching ₹53,720 per sovereign.

Silver prices dropped to $29.25 per ounce.

The dollar index reached 101.09 on Wednesday and fell to 100.94 this morning.

The rupee weakened further yesterday, closing at ₹83.95 per dollar, up by 2 paise.

Crude oil prices fell again, driven by signs of easing tensions in the Middle East. Brent crude fell by 1% to close at $78.65 per barrel, rising slightly to $78.75 this morning. WTI crude is at $74.70, and UAE's Murban crude is at $77.76.

Cryptocurrencies also saw declines yesterday. Bitcoin fell to $58,000 before recovering slightly, while Ethereum is trading at $2,520.

Industrial metals experienced significant declines. Copper fell by 2.05% to $9,135.05 per tonne, aluminum dropped by 2.56% to $2,484.15 per tonne, and other metals also saw substantial declines.

Market Indicators on Wednesday, August 28

• Sensex 30: 81,785.56 (+0.09%)
• Nifty 50: 25,052.35 (+0.14%)
• Bank Nifty: 51,143.85 (-0.26%)
• Mid Cap 100: 59,146.40 (-0.12%)
• Small Cap 100: 19,319.75 (-0.07%)
• Dow Jones 30: 41,091.42 (-0.39%)
• S&P 500: 5,592.18 (-0.60%)
• Nasdaq: 17,556.03 (-1.12%)
• Dollar ($): ₹83.95 (+₹0.02)
• Dollar Index: 101.09 (+0.54)
• Gold (ounce): $2,505.10 (-$19.80)
• Gold (sovereign): ₹53,720 (+₹160)
• Crude (Brent) Oil: $78.65 (-$0.90)