Post Session: Quick Review

After spending most of the day in negative territory, key equity benchmarks finished second-last trading day of 2022 in positive territory helped by sustained buying in Bharti Airtel, SBI stocks. Mirroring weak global cues, Indian markets made gap- down opening, as traders were worried with surging infections in China could trigger fresh outbreaks elsewhere after Beijing dropped zero-COVID policy and reopened economy. Besides, some cautiousness also came in with RBI Monetary Policy Committee (MPC) Member Ashima Goyal’s statement that the government should not go in for an 'aggressive fiscal consolidation' in the upcoming budget as global risks have not abated. Further, indices continued to reel under selling pressure, as sentiments remained downbeat with deteriorating health of the global economy and the possibility of higher interest rates leading to a recession.

Markets continued to trade with subdued mode in afternoon session with private report stating that after three consecutive years of infusing huge funds, foreign portfolio investors retreated from the Indian equity markets in a big way in 2022 with the highest-ever yearly net outflow of nearly Rs 1.21 lakh crore. Traders were taking note of a private report stating that small stocks of Dalal Street grappled with turbulent times in 2022 as high volatility and higher interest rate regime sapped investors' appetite for these scrips but the horizon ahead seems less cloudy for the New Year. However, in late afternoon session, markets wiped out all their losses and turned positive as investors went for beaten down but fundamentally strong stocks.

On the global front, European markets were trading mostly in green tracking gains in U.S. stock futures. Investors’ sentiment remained fragile due to concerns over the Federal Reserve's continued policy tightening and worries about the impact of China's latest COVID wave on global supply chains and inflation. Asian markets ended mostly in red amid concerns about the rapid spread of COVID infections in China and fears about the potential for new variants to emerge. Back home, sector wise, aviation sector remained in limelight on report that with encouraging domestic passenger numbers, Union Minister Jyotiraditya Scindia has said the country's civil aviation sector is witnessing a very strong V-shaped recovery and the growth will continue in the coming years.

The BSE Sensex ended at 61,133.88, up by 223.60 points or 0.37% after trading in a range of 60,479.06 and 61,210.65. There were 19 stocks advancing against 11 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index declined 0.09%, while Small cap index was up by 0.22%. (Provisional)

The top gaining sectoral indices on the BSE were Oil & Gas up by 1.36%, Metal up by 1.14%, Energy up by 1.09%, Bankex up by 0.93% and Utilities was up by 0.88% while, Consumer Durables down by 0.51%, Capital Goods down by 0.42%, FMCG down by 0.12% were the few losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bharti Airtel up by 2.39%, SBI up by 2.10%, Axis Bank up by 1.63%, Tata Steel up by 1.50% and ICICI Bank up by 1.16%. On the flip side, Tata Motors down by 1.20%, Titan Co down by 1.04%, Ultratech Cement down by 0.76%, Larsen & Toubro down by 0.52% and Nestle down by 0.51% were the top losers. (Provisional)

Meanwhile, RBI Monetary Policy Committee (MPC) Member Ashima Goyal said the government should not go in for an 'aggressive fiscal consolidation' in the upcoming budget as global risks have not abated. She further said subsidies are expected to come down as food and energy inflation moderates. WPI inflation in food articles in November was 1.07 per cent against 8.33 per cent in the previous month. In the 'fuel and power' basket, inflation was 17.35 per cent last month.

She said ‘Given fears of a global slowdown, this is not the time for aggressive consolidation. Sticking to small pre-announced steps on the path will minimise growth sacrifice, while moderating demand and the current account deficit, thus lowering the risk premium that keeps spreads high and raises the cost of government and private borrowing’.

According to Goyal, the strategy includes prioritising investment while giving essential support for the vulnerable. She said ‘Better composition of government expenditure and other supply-side action has enabled excellent monetary-fiscal coordination that has strengthened Indian macros’. While noting that debt ratios came down sharply last year under higher growth, she said institutions and incentives have to be strengthened to help sustainably implement the strategy including in states.

According to Goyal, supply-side action also contributed and inflation is already within the tolerance band, without hurting the nascent growth recovery. She asserted ‘India has handled the shocks better than most major economies’.

The CNX Nifty ended at 18,191.00, up by 68.50 points or 0.38% after trading in a range of 17,992.80 and 18,229.70. There were 31 stocks advancing against 19 stocks declining on the index. (Provisional)

The top gainers on Nifty were Eicher Motors up by 2.17%, Bharti Airtel up by 2.11%, SBI up by 1.79%, Tata Steel up by 1.59% and Indusind Bank up by 1.40%. On the flip side, Apollo Hospital down by 1.40%, Tata Motors down by 1.38%, Titan Company down by 1.04%, Ultratech Cement down by 1.02% and Divi's Lab down by 0.99% were the top losers. (Provisional)

European markets were trading mostly in green, France’s CAC increased 1.66 points or 0.03% to 6,512.15 and Germany’s DAX was up by 21.68 points or 0.16% to 13,947.28. On the flip side, UK’s FTSE 100 was down by 29.03 points or 0.39% to 7,468.16.

Asian markets finished mostly lower on Thursday, saddled by the concerns over global supply disruptions, persisting inflation, resurgence of Covid-19, and on fears over ramifications of historic tightening campaign by major Central Banks. Moreover, subdued risk taking in the last week of 2022 and lingering uncertainties over economic rebound in China dulled investor sentiments. Japan’s Nikkei finished lower amid the lingering global macroeconomic headwinds. Moreover, hefty technological sector sell-off and lower exporters pressured the index.