Domestic indices trade higher in early deals

A day after heavy sell-off, Indian equity benchmarks made positive start and are trading higher in early deals on Tuesday helped by gains in IT stocks, even as global markets remained on the edge over escalating Russia-Ukraine tensions. Some support came as in an effort to tame food inflation, the government has reduced import duty on lentils to nil for Australia and Canada origins and cut it to 22%, from 30%, for those originating in the US. Adding optimism, a report stated that India and the UAE are likely to sign a free trade agreement (FTA) on February 18, under which both the countries could give duty-free access to a number of products from different sectors. Though, upside remained capped as retail inflation soared to a seven-month high of 6.01 per cent in January, breaching the upper tolerance level of the Reserve Bank, driven by rising prices certain food items. The inflation in the food basket was 5.43 per cent in January 2022 as against 4.05 per cent in the preceding month.

On the global front, Asian markets traded mixed following the negative cues from Wall Street overnight, as rising geopolitical tensions between Russia and Ukraine triggered a sell-off in global equities, even though crude oil prices is limiting the downside. A surge in global oil prices also exacerbated concerns about inflation and aggressive monetary policy tightening in the U.S. and elsewhere. Back home, coal industry stocks were in focus as the government said India's coal output registered an increase of 6.13 per cent to 79.60 million tonnes in January. India's coal output stood at 75 million tonnes (MT) in January 2020. In scrip specific development, Adani Wilmar traded higher as it reported profit for the period at Rs 211.41 crore for Q3FY22, up 66 per cent YoY from Rs 127.39 crore in Q3FY21.

The BSE Sensex is currently trading at 56586.80, up by 180.96 points or 0.32% after trading in a range of 56557.22 and 56955.09. There were 22 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.06%, while Small cap index was down by 0.55%.

The top gaining sectoral indices on the BSE were TECK up by 0.94%, IT up by 0.94%, FMCG up by 0.59%, Telecom up by 0.44%, Consumer Durables up by 0.24%, while Utilities down by 1.45%, Power down by 1.11%, Oil & Gas down by 0.90%, PSU down by 0.65%, Metal down by 0.42% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 1.45%, Hindustan Unilever up by 1.31%, Titan Company up by 1.28%, Tech Mahindra up by 1.26% and Infosys up by 1.11%. On the flip side, NTPC down by 1.28%, Indusind Bank down by 1.22%, Tata Steel down by 1.10%, ICICI Bank down by 0.74% and Axis Bank down by 0.57% were the top losers.

Meanwhile, breaching the upper tolerance level of the Reserve Bank of India (RBI), retail inflation soared to a seven-month high of 6.01 per cent in January 2022, driven by rising prices certain food items. The Consumer Price Index (CPI) in December 2021 has been revised upwards to 5.66 per cent from 5.59 per cent. In the year-ago month of January 2021, the retail inflation stood at 4.06 per cent. The previous high was 6.26 per cent in June 2021. The RBI, which mainly factors in the CPI-based inflation, has been tasked by the government to keep the inflation at 4 per cent, with margin of 2 per cent on either side.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that the Rural CPI (General) in January 2022 stood at 6.12 per cent as against 5.36 per cent in December. The Urban CPI (General) stood at 5.91 per cent in January as against 5.90 per cent in December. The index value for Rural, Urban and Combined CPI (General) stood at 166.4, 165.0 and 165.7 respectively, in January 2022.

As per the data released by the NSO, the inflation in the food basket was 5.43 per cent in January 2022 as against 4.05 per cent in the preceding month. The rate of price rise in ‘cereals and products’ quickened to 3.39 per cent during the month as against 2.62 per cent in December. Likewise, the retail inflation in ‘meat and fish’ category accelerated to 5.47 per cent from 4.58 per cent. In vegetables, the inflation moved up to 5.19 per cent against a deceleration of (-) 2.99 per cent in December. However, price rise of ‘oil and fats’ softened during the month with an inflation print at 18.70 per cent. Fuel and light segment too witnessed a softening of inflation at 9.32 per cent against 10.95 per cent.

The Price data are collected from selected 1114 urban Markets and 1181 villages covering all States/UTs through personal visits by field staff of Field Operations Division of NSO, MoSPI on a weekly roster. During the month of January 2022, NSO collected prices from 99.7% villages and 98.2% urban Markets while the Market-wise prices reported therein were 89.3% for rural and 93.3% for urban.

The CNX Nifty is currently trading at 16881.90, up by 39.10 points or 0.23% after trading in a range of 16869.00 and 16998.95. There were 31 stocks advancing against 18 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Wipro up by 1.40%, Hindustan Unilever up by 1.30%, Shree Cement up by 1.26%, Tech Mahindra up by 1.25% and Titan Company up by 1.17%. On the flip side, Cipla down by 3.36%, Indusind Bank down by 1.35%, BPCL down by 1.01%, Tata Steel down by 1.01% and NTPC down by 0.91% were the top losers.

Asian markets are trading mixed; Nikkei 225 declined 98.98 points or 0.37% to 26,980.61, Straits Times lost 7.48 points or 0.22% to 3,413.72, Hang Seng slipped 170.63 points or 0.69% to 24,385.94 and KOSPI was down by 9.52 points or 0.35% to 2,694.96. On the other hand, Taiwan Weighted added 73.69 points or 0.41% to 18,071.36, Jakarta Composite rose 47.89 points or 0.71% to 6,782.38 and Shanghai Composite was up by 13.63 points or 0.40% to 3,442.51.