Benchmark indices trade higher in early deals ahead of macro-economic data

Indian equity benchmarks made flat-to-positive start on Wednesday on account of bargain hunting after three-session losing streak coupled with falling crude oil prices. Soon, markets gained some traction and are trading higher with gains of around half a percent each in early deals ahead of macro-economic data. Buying in all the sector indices also aiding the sentiments. Some support came in as Finance Minister Nirmala Sitharaman exuded confidence on India's relative and absolute growth performance in the rest of the decade and forecast the country's growth rate to be around 7% this financial year. But, persistent worries over economic growth-inflation dynamics and renewed geopolitical tensions following attacks by Russia on major Ukrainian cities, limited upside. Some cautiousness also came as the International Monetary Fund (IMF) in its annual World Economic Outlook report said outlook for India is growth of 6.8 per cent in 2022 - a 0.6 percentage point downgrade since the July forecast, reflecting a weaker-than-expected outturn in the second quarter and more subdued external demand. Meanwhile, investors are looking ahead of the IIP and CPI data to be out later in the day.

Most of the Asian markets are trading lower following the broadly negative cues from global markets overnight, due to continuing concerns about rising interest rates and economic slowdown. A downward revision in the global economic growth forecast by the International Monetary Fund also weighed on the markets. Meanwhile, the value of core machinery orders in Japan was down a seasonally adjusted 5.8% on month in August, the Cabinet Office said - standing at 909.8 billion yen. Back home, railways related stocks were in focus with a private report that the railways' passenger revenue in the period between April 1 and October 8 was around Rs 33,476 crore, an increase of 92% over Rs 17,394 crore in the corresponding period last year. In stock specific developments, Wipro and HCL Technologies gained ahead of their earnings results due later in the day. Suzlon Energy rallied after it secured 144.9 MW order from the Aditya Birla Group.

The BSE Sensex is currently trading at 57455.72, up by 308.40 points or 0.54% after trading in a range of 57144.44 and 57457.62. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.42%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Power up by 1.09%, Utilities up by 1.06%, IT up by 0.95%, Auto up by 0.80%, Realty up by 0.77%, while there was no loser on the BSE sectoral front.

The top gainers on the Sensex were Power Grid up by 2.74%, HCL Technologies up by 2.34%, Mahindra & Mahindra up by 1.65%, Wipro up by 1.26% and NTPC up by 1.24%. On the flip side, Asian Paints down by 0.69%, Bharti Airtel down by 0.65% and Dr. Reddy's Lab down by 0.28% were the few losers.

Meanwhile, the International Monetary Fund (IMF) in its annual World Economic Outlook report has cut its projection of India’s economic growth in 2022 to 6.8 per cent - a 0.6 percentage point downgrade since the July forecast, reflecting a weaker-than-expected outturn in the second quarter and more subdued external demand. The IMF had in July projected a gross domestic product (GDP) growth of 7.4 per cent for India in the fiscal year that started in April 2022. Even that forecast was lower than 8.2 per cent projected in January this year. India had grown at 8.7 per cent in 2021-22 fiscal (April 2021 to March 2022).

The IMF said global growth is forecast to slow from 6.0 per cent in 2021 to 3.2 per cent in 2022 and 2.7 per cent in 2023. This is the weakest growth profile since 2001, except for the global financial crisis and the acute phase of the COVID-19 pandemic. It said the economic growth projections reflect significant slowdowns for the largest economies: a US GDP contraction in the first half of 2022, a euro area contraction in the second half of 2022, and prolonged COVID-19 outbreaks and lockdowns in China with a growing property sector crisis.

Pierre-Olivier Gourinchas, Economic Counsellor and the Director of Research of the IMF, in his forward to the WEO released said ‘The global economy continues to face steep challenges, shaped by the lingering effects of three powerful forces: the Russian invasion of Ukraine, a cost-of-living crisis caused by persistent and broadening inflation pressures, and the slowdown in China’.  More than a third of the global economy will contract in 2023, while the three largest economies - the United States, the European Union, and China - will continue to stall. He said ‘In short, the worst is yet to come, and for many people 2023 will feel like a recession’. Growth rate projections for China is 3.2 per cent, down from 8.1 per cent growth rate in 2021.

The CNX Nifty is currently trading at 17064.95, up by 81.40 points or 0.48% after trading in a range of 16976.75 and 17070.60. There were 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 2.71%, HCL Technologies up by 2.41%, BPCL up by 2.07%, Mahindra & Mahindra up by 1.87% and Tech Mahindra up by 1.30%. On the flip side, ONGC down by 1.07%, Asian Paints down by 0.74%, Bharti Airtel down by 0.60%, Apollo Hospital down by 0.37% and Adani Enterprises down by 0.35% were the top losers.

Asian markets are trading mostly in red; Nikkei 225 fell 42.82 points or 0.16% to 26,358.43, Straits Times dropped 13.28 points or 0.43% to 3,091.72, Hang Seng plunged 330.96 points or 1.97% to 16,501.40, Taiwan Weighted slipped 21.43 points or 0.16% to 13,084.60, Jakarta Composite declined 51.43 points or 0.74% to 6,887.72 and Shanghai Composite was down by 36.55 points or 1.23% to 2,943.24, while KOSPI was up by 0.75 points or 0.03% to 2,192.82.