Domestic indices wipe out opening gains; trade in red in early deals

Indian equity benchmarks made slightly positive start on Tuesday tracking mostly positive cues from Asian counterparts. But, soon markets wiped out all the gains and slipped into red terrain in early deals as selling in Metal, IT, Realty, TECK and Energy stocks dragged the indices down. Initially, traders got some support as Defence Minister Rajnath Singh said inflation in India is less as compared to the US, the UK and other countries. Meanwhile, the government data showed that retail inflation dropped to 6.77 per cent in October from 7.41 per cent in the preceding month, mainly due to easing prices in the food basket, though it remained above Reserve Bank's comfort level for the 10th month in a row. Traders took note of a World Bank report stating that India will need to invest $840 billion over the next 15 years to upgrade its urban infrastructure if it is to effectively meet the needs of its fast-growing population in cities. Besides, Petroleum and Natural Gas Minister Hardeep Singh Puri said the Centre is ready for bringing petrol and diesel under the GST regime but it is unlikely that the states will agree to such a move.

Most of the Asian markets are trading higher despite the broadly negative cues from Wall Street overnight, as traders continue to be optimistic about the US Fed slowing the pace of interest rate hikes following recent tamer-than-expected US inflation data. The positive sentiment comes on the back of comments from Fed Vice Chair Lael Brainard that added to optimism about a slower pace of rate hikes. Meanwhile, Japan's gross domestic product was down an annualized 1.2% on year in the third quarter of 2022.

Back home, auto component industry stocks were in focus as credit ratings agency ICRA in a report said auto component suppliers are expected to log an 8-10 per cent growth in revenue this fiscal driven by healthy domestic original equipment manufacturers (OEMs) and pent-up demand from the aftermarket even as headwinds persist on the exports front. In stock specific development, Greaves Cotton surged on posting Rs 29 crore profit in Q2 from a loss of Rs 23 crore a year-ago.

The BSE Sensex is currently trading at 61502.48, down by 121.67 points or 0.20% after trading in a range of 61502.48 and 61783.00. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.05%, while Small cap index was up by 0.06%.

The top gaining sectoral indices on the BSE were Auto up by 0.66%, Telecom up by 0.29%, Utilities up by 0.28%, Power up by 0.26%, Oil & Gas up by 0.24%, while Metal down by 1.10%, IT down by 0.71%, Realty down by 0.53%, TECK down by 0.47%, Energy down by 0.38% were the top losing indices on BSE.

The top gainers on the Sensex were Ultratech Cement up by 1.68%, ICICI Bank up by 1.10%, Dr. Reddy's Lab up by 0.90%, NTPC up by 0.82% and Bharti Airtel up by 0.68%. On the flip side, Tech Mahindra down by 1.22%, ITC down by 1.14%, TCS down by 0.99%, HDFC down by 0.77% and HCL Technologies down by 0.75% were the top losers.

Meanwhile, with easing prices in the food basket, India’s retail inflation measured in Consumer Price Index (CPI) dropped to 6.77 per cent in October 2022 from 7.41 per cent in the preceding month. The retail inflation, which the RBI factors in while deciding its periodic monetary policy, was 4.48 per cent in October 2021. Though, the inflation remained above Reserve Bank's comfort level for the 10th month in a row. The CPI has remained above the 6 per cent target since January this year. Besides, the inflation in the food basket was 7.01 per cent in October as against 8.6 per cent in September.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that Rural CPI (General) in October 2022 stood at 6.98 percent as against 7.56 in September. The Urban CPI (General) stood at 6.50 percent in October as against 7.27 per cent in September. The index value for Rural, Urban and Combined CPI (General) stood at 177.9, 175.3 and 176.7 respectively, in October 2022.

As per the data, egg prices dipped 0.18 per cent on-year in October, while oils and fats declined 2.15 per cent. There was no change in sugar and confectionery segment. On the other hand, vegetables rose 7.77 per cent on year last month, cereals and products climbed 12.08 per cent and spices saw a rise of 18.02 per cent. Milk and products rose 7.69 per cent and meat and fish prices inched 3.08 per cent while that of fruits rose 5.20 per cent. Apart from food and beverages, the fuel and light segment rose 9.93 per cent, clothing and footwear gained 10.16 per cent and the housing segment inched up 4.58 per cent.

The CNX Nifty is currently trading at 18298.90, down by 30.25 points or 0.17% after trading in a range of 18297.15 and 18378.15. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were ONGC up by 2.15%, Hero MotoCorp up by 1.84%, Ultratech Cement up by 1.66%, ICICI Bank up by 1.10% and Divi's Lab up by 0.94%. On the flip side, Coal India down by 5.00%, ITC down by 1.12%, Tech Mahindra down by 1.12%, TCS down by 1.00% and Sun Pharma down by 0.78% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 59.61 points or 0.21% to 28,023.08, Straits Times advanced 14.61 points or 0.45% to 3,275.41, Hang Seng jumped 602.17 points or 3.42% to 18,221.88, Taiwan Weighted soared 362.81 points or 2.56% to 14,537.71, KOSPI added 0.62 points or 0.03% to 2,475.27 and Shanghai Composite was up by 39.18 points or 1.27% to 3,122.58, while Jakarta Composite was down by 3.95 points or 0.06% to 7,015.44.