Opening Bell - 13 / 03 / 25

Stock Market Updates

HSL Prime Research

Opening Bell - Morning Commentary

Economic Tailwinds Set to Ignite Market Optimism

U.S. investors breathed a sigh of relief on Wednesday after February inflation figures came in below forecasts, triggering a rebound in the S&P 500 and Nasdaq from six-month lows. This positive momentum should help put global markets on a firm footing for Thursday's trading session.

Stocks reclaimed lost ground, buoyed by cooler-than-expected inflation readings and a rally in the technology sector. The core Consumer Price Index (CPI) increase was the slowest since April 2021, marking a significant deceleration from when inflation first began surging.

Market participants will closely monitor tomorrow's Producer Price Index (PPI) release for additional insights into inflation trends at the producer level. Investors will also remain vigilant regarding any developments on government funding negotiations.

In India, February's Consumer Price Index (CPI) data registered at 3.61%, substantially below the consensus estimate of 3.98%, indicating a significant easing of inflationary pressures. Simultaneously, industrial output for January jumped to 5%, considerably outpacing projections of 3.5%, demonstrating robust manufacturing activity and production strength across sectors.

This dual economic surprise—inflation cooling more rapidly than anticipated while industrial production showing unexpected vigor—creates an ideal macroeconomic environment poised to energize bullish market sentiment.

The lower-than-expected CPI inflation, which fell below the Reserve Bank of India's (RBI) medium-term target of 4%, has substantially increased the likelihood of another rate cut during the central bank's April monetary policy meeting.

Indian markets experienced sharp fluctuations yesterday as weak global cues and escalating trade tensions triggered downgrades in IT stocks, causing indices to oscillate throughout the session. However, strong gains in banking stocks facilitated a market recovery in the second half. The Nifty staged an impressive rebound of 165 points from its intraday low, successfully maintaining support above 22,300 and concluding the session with a minimal decline of 27 points (0.12%), closing at 22,470.

For four consecutive trading sessions, the Nifty has traded within a narrow range that will likely be broken to the upside today. A move above 22,677 could trigger a further rally toward the next resistance level at 23,000. On the downside, the support band between 22,245 and 22,300 should continue providing a solid floor for the index.