Mumbai: Indian equities rose nearly 0.5% in early deals on Wednesday, tracking gains in global equities after the White House delayed tariffs on some Chinese imports. The gains in domestic equities also followed expectation that the Reserve Bank of India will stick to its dovish monetary policy stance after retail inflation grew at a slower pace.

At 9.30 am, the benchmark Sensex index was up 0.45% at 37,125.96 points, while Nifty gained 0.52% to 10,982.30 points.

The US said it was delaying until 15 December the 10% tariff on some China-made products such as such as phones, laptops and toys that feature high on many holiday-shopping lists.

Back home, government data released on Tuesday showed that Consumer Price Index-based inflation (CPI) rose 3.15% in July, lower than 3.18% in June and also lower than RBI’s medium-term target of 4%.

"We maintain our call that we are at the end of the monetary policy easing cycle. In our view, the RBI is likely to deliver a token 15 basis points cut in policy rates at the next policy meeting in October, before maintaining the status quo, as it moves into data dependence mode to assess the impact of the cuts already delivered", said Nomura Research in a note to its investors.

On Tuesday, markets fell nearly 1.7% tracking global markets which fell as turmoil in Hong Kong and Argentina spooked investors already on edge over the protracted trade war.

Given a lack of clarity about the relief measures on surcharge on tax on FPIs and stimulus for sectors including auto, coupled with weakness in global equities may lead to further selling in the Indian stock market, analysts believe.

"We believe the bears are here to stay for a while and it won't be easy and quick for the market to recover anytime soon. We remain cautious and maintain our sell on a rising approach", said Mustafa Nadeem, CEO Epic Research.

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