Domestic benchmark indices bucked India’s inflation numbers and opened with strong gains on Tuesday, tracking the global cues. US stocks settled higher on Monday, whereas Asian stocks were also up. Traders await the US inflation data later in the for hints at the path of the Federal Reserve’s future interest rate hikes.
At 9.20 am, the 30-share pack BSE Sensex was trading 233.50 points, or 0.39 per cent, higher at 60,665.34. NSE’s Nifty50 index added 51.90 points 0.29 per cent to 17,882.80. In the broader markets, BSE midcap index dropped, whereas BSE smallcap index rose slightly. Fear gauge India VIX eased more than one per cent to 13.53-level.
“The index started the week on a subdued note and underwent lacklustre movement after initial decline. The daily price action formed a bear candle carrying lower low, indicating extended breather in the vicinity of 20 days EMA,” said ICICIDirect Research.
“Going ahead, a decisive move above the upper band of consolidation coinciding with budget day high (placed at 18,000) will confirm the conclusion of corrective bias and open the door for an up move towards 18,300 in coming weeks. Thus, any dip from here on should not be construed as negative,” it said.
On a sectoral front, the IT index jumped about a per cent, followed by strong buying in metals, financial services and banking counters. On the contrary, Media and realty indices eased about a per cent each, whereas pharma and auto index were also down.
Among the Adani Group stocks, Adani Enterprises could not hold the early gains and was down 2 per cent ahead of its December 2022 quarter results. Ambuja Cements and ACC were also trading in red, whereas Adani Ports rose more than a per cent.
Among the cash market counters of Gautam Adani led Conglomerate, Adani Green Energy, Adani Total Gas, Adani Power, Adani Transmission, Adani Wilmar and New Delhi Television (NDTV) were locked in sellers’ circuits of 5 per cent each.
In the Nifty50 pack, UPL surged 3 per cent, whereas Infosys was up 2 per cent. Tata Consultancy Services, Tata Steel, Wipro, HCL Technologies and Tech Mahindra gained about a per cent each. Among the losers, Apollo Hospitals shed more than a per cent ahead of its quarterly earnings. Tata Motors, IndusInd Bank and Grasim were other key laggards.
Uncertainty about the market trend continues. The new concern is the reversal of the declining inflation trend observed in December. The January CPI number at 6.52 % spiking from 5.72% in December is a big negative. The MPC will have to raise rates again in the April meeting, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
“IndiaтАЩs underperformance in 2023, so far, is striking. We have underperformed both developed markets like US and Europe and large emerging markets like China, Hong Kong and South Korea. Investors may exercise caution and wait patiently for this underperformance phase to play out,” he said.
In the broader markets, Mirza International surged more than 13 per cent after a strong performance in the December 2022 quarter. National Fertilizers jumped 9 per cent, whereas Neuland Laboratories, Dishman Carbogen and Oil India extended gains, rising 7-9 per cent each.
On the down side, EKI Energy Services hit a lower circuit of 20 per cent for the second straight session. Allcargo Logistics and RHI Magnesita tumbled 11-13 per cent after poor performance in the December 2022 quarter. Emami Paper and Hindware Home Innovations were down up to 8 per cent.
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