Key stocks to watch: Jio Financial, Antony Waste, Gravita India, Lupine and Diffusion Engineers

Indian equity markets suffered a sharp decline last week, with benchmark indices falling almost 4.5% due to tensions in the Middle East and concerns about foreign institutional investors (FIIs) shifting funds to cheaper Asian markets such as China.

The BSE Sensex index fell 3,883 points to 81,688 and the Nifty 50 fell 1,164 points to 25,015. Experts predict continued consolidation, recommending a sales-led approach. Key events to watch include the RBI monetary policy meeting, corporate earnings, geopolitical tensions and US inflation data.

The most important factors in the game
RBI Policy: All eyes are on the upcoming RBI monetary policy meeting scheduled for October 9, where no rate cut is expected. However, commentary on the timing of future interest rate cuts will be critical and will impact interest rate-sensitive sectors such as banking, automotive and real estate.

Corporate Profits: Several companies are scheduled to post their September quarter earnings, including Tata Consultancy Services, Tata Elxsi and Avenue Supermarts. The management’s comment on the recovery after the Fed’s interest rate cut will be important for the market prospects.

Tensions in the Middle East and oil prices: Rising tensions between Israel and Hezbollah have pushed up oil prices, which could impact India, a net importer of oil. A further rise in oil prices could trigger inflationary pressure, particularly in sectors such as paints and tires.

US and FOMC Inflation Protocols: Global investors will focus on US inflation data and FOMC minutes to assess the Fed’s next policy move. The decline in inflation in the US to 2.5% in August gives hope for a soft landing of the world’s largest economy.

FII Flow: The outflow of FII funds from India due to lower valuations in Asian markets such as China is a concern. FIIs sold shares worth Rs 40,500 crore last week, with DIIs offsetting most of the amount with purchases worth Rs 33,074 crore.

National economic data: Data on industrial production for August and foreign exchange reserves will be released on October 11, providing better insight into the domestic economy.

Stocks to watch

• Jio Financial Services: SEBI has approved the company’s plan to set up a mutual fund with BlackRock.
• GAIL (India): Signed MoU with AM Green for renewable energy projects.
• Lupine: Following the inspection, the US FDA has issued five observations regarding its biotechnology facility in Pune.
• Antony Waste Handling Cell: Secured Rs 908 crore contract from Navi Mumbai Municipal Corporation.
• One 97 Communications (Paytm): Deependra Singh Rathore appointed as CTO, Payments, replacing Manmeet Singh Dhody.
• Gravita India: Approved to raise up to Rs 1,000 crore in equity capital.
• Bank of Maharashtra: Closed qualified institutional placement by raising Rs 3,500 crore.
• Adani Energy Solutions: New subsidiary established for global transmission projects.

Collective and block offers
Diffusion Engineers: Alternative investment fund 3P India Equity Fund 1 has acquired 2.94% stake.
HDFC Bank: BNP Paribas Financial Markets sold 43.75 lakh shares to Morgan Stanley Asia and Citigroup Global Markets Mauritius.