Benchmarks trade tad higher with volatility in early deals

Indian equity benchmarks made cautious start on Friday the last trading session of the week amid mixed global cues. Markets soon turned volatile and struggling for the direction. Investors remained on sidelines and avoided taking any long positions ahead of kick start of earning season in coming week. Now, the domestic indices are trading flat with positive bias in early deals led by gains in index majors such as ITC and Reliance Industries. Some support came in as the commerce and industry ministry is hopeful of improvement in foreign direct investment (FDI) inflows in the coming months despite global headwinds. Though, trading sentiments were somewhat cautious amid persistent selling by foreign investors. Foreign institutional investors (FII) sold shares worth Rs 1,449.45 crore on January 5, as per provisional data available on the NSE.

On the global front, most of the Asian markets are trading higher, despite the broadly negative cues from Wall Street overnight, with traders remaining largely cautious after data showing stronger than expected US private jobs growth points to continued strength in the labor market, which will see the lower interest rate hikes to continue. Back home, coal industry stocks were in focus as the dispatch of coal to different sectors was at 78.91 million tonnes (MT) in December, registering a rise of 5.28 per cent. The coal dispatch in the corresponding month of previous fiscal was 74.95 MT. In stock specific development, Rail Vikas Nigam gained after it bagged order from ISC Projects to commission ballastless track for Surat Metro Rail Project, Phase-1.

The BSE Sensex is currently trading at 60422.64, up by 69.37 points or 0.11% after trading in a range of 60279.37 and 60537.63. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.07%, while Small cap index was down by 0.03%.

The top gaining sectoral indices on the BSE were FMCG up by 0.64%, Capital Goods up by 0.43%, Industrials up by 0.42%, Consumer Durables up by 0.35%, Telecom up by 0.20%, while IT down by 0.43%, TECK down by 0.37%, Bankex down by 0.34%, Power down by 0.27%, Utilities down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 1.09%, Reliance Industries up by 1.05%, Hindustan Unilever up by 0.83%, Larsen & Toubro up by 0.78% and Mahindra & Mahindra up by 0.73%. On the flip side, Bajaj Finserv down by 0.98%, TCS down by 0.91%, Indusind Bank down by 0.80%, ICICI Bank down by 0.68% and Infosys down by 0.65% were the top losers.

Meanwhile, the Department for Promotion of Industry and Internal Trade (DPIIT) Joint Secretary Manmeet K Nanda has said that the commerce and industry ministry is hopeful of improvement in foreign direct investment (FDI) inflows in the coming months despite global headwinds. According to the DPIIT data, FDI equity inflows into India contracted by 14 per cent to $26.9 billion during the April-September this fiscal. The total FDI inflows (which includes equity inflows, re-invested earnings and other capital) too declined to $39 billion during the first six months of the current fiscal against $42.86 billion in the year-ago period.

She said that usually investments and equity inflows improve towards the last quarter of a financial year. She also said that foreign inflows have a lot of effect because of the global slowdown that ‘we are seeing for the last 18 months...But we are hopeful, India has shown very great numbers compared to rest of the countries...So, we are hoping that we would be making up for all that would have been a drop by’.

Talking about the national single window system (NSWS), Nanda said that about 75,600 approvals were granted so far through this system out of over 1,23,000 applications received. NSWS was soft-launched to all stakeholders and the public in September 2021 to provide a single platform to enable the identification and obtaining of approvals and clearances needed by investors, entrepreneurs, and businesses in India. Out of 75,600 approvals, 57,850 approvals have been approved by the commerce ministry. So far, 27 central ministries and departments have been onboarded on the system, besides 19 states and UTs.

On the number of pending FDI proposals particularly from China under Press Note 3 (PN3) of 2020, she said ‘pendency is probably the lowest at this point in time’. Under that press note, the government had made its prior approval mandatory for foreign investments from countries that share a land border with India to curb opportunistic takeovers of domestic firms following the COVID-19 pandemic. She said ‘there is a mechanism through which all these proposals are viewed at. There is an inter-ministerial committee that looks at it...’.

The CNX Nifty is currently trading at 18004.40, up by 12.25 points or 0.07% after trading in a range of 17970.20 and 18047.40. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.03%, Reliance Industries up by 1.01%, ITC up by 1.00%, Tata Consumer Products up by 0.81% and UPL up by 0.79%. On the flip side, Coal India down by 1.28%, JSW Steel down by 1.16%, Bajaj Finserv down by 1.06%, TCS down by 0.89% and Indusind Bank down by 0.86% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 160.11 points or 0.62% to 25,980.91, Hang Seng advanced 108.26 points or 0.51% to 21,160.43, Taiwan Weighted rose 66.96 points or 0.47% to 14,368.01, KOSPI increased 29.88 points or 1.32% to 2,294.53, Jakarta Composite added 33.76 points or 0.51% to 6,687.60 and Shanghai Composite was up by 11.69 points or 0.37% to 3,166.91, while Straits Times was down by 6.95 points or 0.21% to 3,285.71.