Benchmarks give up opening gains; trade lower in early deals

Indian equity benchmarks have continued their bull run with optimistic start on Tuesday as investors reacted to falling oil prices, easing of tensions between Russia and Ukraine. Soon, markets give up their all gains and slipped below neutral lines to trade lower with cut of around 0.25% each in early deals amid lackluster global cues. Weak inflation data also dampened sentiments in the markets. Data released by the Ministry of Statistics and Programme Implementation showed that India's retail inflation in February rate rose to an eight-month high of 6.07 percent from 6.01 percent in the previous month, remaining above the upper limit of the central bank’s comfort level of 6 per cent for the second consecutive month. Traders were concerned as SBI forecast more pain for the rupee if the ongoing Ukraine war lingers, plumbing to a new low of 77.5 to a dollar by June and marginally improving to 77 by end-December. It also said the current account deficit (CAD) will be at 3.5 per cent if crude oil trades at $130 a barrel, pulling down growth to 7.1 per cent. Besides, foreign institutional investors (FIIs) continue selling in India as they have net sold shares worth Rs 176.52 crore on March 14, the lowest offloading in a single day in the last one month.

Most of the Asian markets are trading lower following the mostly negative cues from Wall Street overnight, on concerns about the outlook for inflation following crude oil's sharp uptick and caution ahead of major central bank meetings this week, including the U.S. Fed. Also, reports that China is seeing its worst Covid outbreak in more than two years have raised concerns over demand and supply chain. Meanwhile, traders are hopeful the Russia-Ukraine peace talks that resumed today could lead to a diplomatic solution to the ongoing war. Back home, real estate industry stocks were in focus as the government widened the meaning of Real estate business under the foreign direct investment (FDI) policy which now includes dealing in land and immovable property to earn profit. In scrip specific development, SpiceJet rose amid reports that it would launch 60 new domestic flights this summer.

The BSE Sensex is currently trading at 56348.60, down by 137.42 points or 0.24% after trading in a range of 56304.17 and 56720.60. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.39%, while Small cap index was up by 0.38%.

The top gaining sectoral indices on the BSE were Realty up by 1.28%, Auto up by 1.03%, Healthcare up by 0.90%, FMCG up by 0.62%, Consumer discretionary up by 0.53%, while Metal down by 2.17%, Oil & Gas down by 1.22%, Energy down by 0.90%, IT down by 0.77%, PSU down by 0.69% were the top losing indices on BSE.

The top gainers on the Sensex were Maruti Suzuki up by 2.19%, Ultratech Cement up by 1.91%, Mahindra & Mahindra up by 1.59%, Sun Pharma up by 1.39% and ITC up by 0.82%. On the flip side, Tata Steel down by 2.36%, Infosys down by 1.40%, Kotak Mahindra Bank down by 1.37%, Tech Mahindra down by 0.84% and Reliance Industries down by 0.74% were the top losers.

Meanwhile, remaining above the Reserve Bank of India’s (RBI’s) comfort level for the second month in a row, retail inflation rose to an eight-month high of 6.07 per cent in February, mainly on account of a rise in food prices. The RBI has been asked by the government to ensure that the CPI inflation remains at 4 per cent with a margin of 2 per cent on either side. The Consumer Price Index (CPI) based retail inflation was 5.03 per cent in February 2021 and 6.01 per cent in January 2022. The previous high was 6.26 per cent in June 2021.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that the Rural CPI (General) in February 2022 stood at 6.38 per cent as against 6.12 per cent in January. The Urban CPI (General) stood at 5.75 per cent in February as against 5.91 per cent in January. The index value for Rural, Urban and Combined CPI (General) stood at 166.7, 165.5 and 166.1 respectively, in February 2022.

As per the data released by the NSO, the rate of price rise in the food basket was 5.89 per cent in February, up from 5.43 per in the preceding month. In the food basket, inflation in cereals moved up to 3.95 per cent; meat and fish to 7.45 per cent, while for eggs, the rate of price rise was 4.15 per cent during the month. Among others, vegetables turned dearer with an inflation print of 6.13 per cent, and for spices it rose to 6.09 per cent. In fruits, the inflation remained static at 2.26 per cent when compared to the preceding month. In ‘fuel and light’, inflation softened to 8.73 per cent from 9.32 per cent in January.

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 February 2022, NSO collected prices from 99.6% villages and 98.2% urban Markets while the Market-wise prices reported therein were 89.6% for rural and 92.9% for urban.

The CNX Nifty is currently trading at 16822.75, down by 48.55 points or 0.29% after trading in a range of 16819.45 and 16927.75. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Products up by 3.15%, Cipla up by 2.74%, Maruti Suzuki up by 2.12%, Ultratech Cement up by 2.06% and Mahindra & Mahindra up by 1.60%. On the flip side, ONGC down by 3.67%, Hindalco down by 3.21%, Tata Steel down by 2.37%, JSW Steel down by 2.07% and Coal India down by 1.50% were the top losers.

Asian markets are trading mostly in red; Hang Seng slipped 586.28 points or 3.00% to 18,945.38, Taiwan Weighted plunged 327.88 points or 1.90% to 16,935.16, KOSPI fell 19.96 points or 0.75% to 2,625.69, Jakarta Composite declined 20.49 points or 0.29% to 6,931.71 and Shanghai Composite lost 70.42 points or 2.18% to 3,153.11. On the other hand, Nikkei 225 surged 95.93 points or 0.38% to 25,403.78 and Straits Times was up by 19.67 points or 0.61% to 3,251.70.