Markets pare opening gains; trade slightly higher in early deals

Indian equity benchmarks extended their previous session’s gains with optimistic start on Tuesday tracking overnight gains on Wall Street. Soon, markets turned volatile and are trading slightly higher in early deals on account of buying in Utilities, Power and PSU counters. Some support came in as the country’s Trade Minister Piyush Goyal said India expects to achieve its export target of $400 billion in the current fiscal year that runs through March. He added India’s exports in the April-December period came to about $300 billion. December, 2021 also saw the highest ever level of monthly outbound trade at $37 billion. However, upside remained capped as data from the Centre for Monitoring Indian Economy (CMIE) showed unemployment rate in the country touched a four-month high of 7.91 per cent in December 2021.

On the global front, Asian markets traded mixed following the broadly positive cues from Wall Street overnight, aided by higher crude oil prices, even as concerns remain over the surging cases of the coronavirus Omicron variant in several countries, including the U.S. But activity was somewhat subdued with investors looking ahead to the minutes of the U.S. Federal Reserve's December monetary policy meeting later this week for cues on the global economic recovery from the pandemic.

Back home, select banking stocks were in focus as an assessment by rating agency ICRA suggested that the gross non–performing assets (GNPAs) of small finance banks (SFBs) is expected to go up by 70-80 basis points (bps) by the end of the current financial year (FY22) compared to FY21 levels. In scrip specific development, Future Retail jumped after it approached the Delhi High Court to quash Singapore arbitration proceedings.

The BSE Sensex is currently trading at 59266.45, up by 83.23 points or 0.14% after trading in a range of 59084.40 and 59496.70. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.11%, while Small cap index was up by 0.09%.

The top gaining sectoral indices on the BSE were Utilities up by 1.01%, Power up by 1.00%, PSU up by 0.94%, Oil & Gas up by 0.69%, Energy up by 0.64%, while IT down by 0.37%, TECK down by 0.27%, Healthcare down by 0.25%, Consumer Durables down by 0.25%, Auto down by 0.21% were the top losing indices on BSE.

The top gainers on the Sensex were NTPC up by 2.34%, Power Grid up by 2.12%, Axis Bank up by 1.06%, Bajaj Finance up by 0.61% and Reliance Industries up by 0.58%. On the flip side, HCL Technologies down by 0.74%, Indusind Bank down by 0.69%, Wipro down by 0.63%, Tech Mahindra down by 0.62% and Ultratech Cement down by 0.60% were the top losers.

Meanwhile, the Centre for Monitoring Indian Economy (CMIE) in its latest data has showed that the unemployment rate in the country touched a four-month high of 7.91 percent in December 2021. The unemployment rate had stood at 7 percent in November, the highest since August which was at 8.3 percent.

According to the CMIE data, the urban unemployment rate was at 9.30 percent in December from 8.21 percent in November 2021, while the unemployment rate in rural areas stood at 7.28 percent from 6.44 percent in the previous month.

CMIE Managing Director and CEO Mahesh Vyas has said that in December 2021, the number of jobs increased but the number of jobseekers was even higher. He added ‘This is a good sign as the influx into the labour market was high. Around 8.3 million additional people were looking for jobs. However, four million jobseekers got employment’.

The CNX Nifty is currently trading at 17657.40, up by 31.70 points or 0.18% after trading in a range of 17593.55 and 17715.45. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were NTPC up by 2.98%, ONGC up by 2.55%, Power Grid up by 2.51%, Axis Bank up by 1.31% and SBI Life Insurance up by 1.21%. On the flip side, Tata Motors down by 1.31%, Tata Consumer Products down by 1.26%, HCL Technologies down by 0.85%, Shree Cement down by 0.73% and Infosys down by 0.70% were the top losers.

Asian markets are trading mixed; Nikkei 225 surged 452.91 points or 1.57% to 29,244.62, Straits Times rose 39.73 points or 1.27% to 3,173.98, Taiwan Weighted jumped 191.13 points or 1.05% to 18,461.64 and Jakarta Composite was up by 38.83 points or 0.58% to 6,704.14. On the other hand, Hang Seng declined 88.05 points or 0.38% to 23,186.70, KOSPI fell 10.11 points or 0.34% to 2,978.66 and Shanghai Composite was down by 12.68 points or 0.35% to 3,627.10.