Firm trade continues over Dalal Street

Firm trade continued over the Dalal Street, with both Sensex and Nifty holding notable gains, as the Reserve Bank projected India's economic growth at 6.4 per cent for 2023-24, broadly in line with the estimate of the Economic Survey tabled in Parliament last week. Besides, the Reserve Bank projected retail inflation to ease to 5.3 per cent in next fiscal from 6.5 per cent this year on assumptions of lower imported inflation, even though core inflation remains sticky.

Adding some relief among traders, a private report stated that loans amounting to Rs 15,626 crore have been sanctioned under Agriculture Infrastructure Fund to create 21,380 infrastructure units at an aggregate investment of more than Rs 32,000 crore all over the country till January this year. The Central Government is providing grants-in-aid to states to promote Agriculture Infrastructure Fund and to improve agriculture.

On the global front, Asian markets were trading mixed, after a measure of the public assessment of the current situation of the Japanese economy weakened somewhat at the start of the year, while the outlook improved to the strongest level in eight months. The survey data from the Cabinet Office showed that the current conditions index of the Economy Watchers' Survey, which measures the present situation of the economy, fell to 48.5 in January from 48.7 in December. Any reading below 50 suggests pessimism.

The BSE Sensex is currently trading at 60595.32, up by 309.28 points or 0.51% after trading in a range of 60324.92 and 60792.10. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.54%, while Small cap index was up by 0.45%.

The top gaining sectoral indices on the BSE were IT up by 1.69%, TECK up by 1.36%, Metal up by 0.72%, Healthcare up by 0.62% and Consumer Durables up by 0.21%, while Capital Goods down by 0.41%, PSU down by 0.31%, Auto down by 0.31%, Industrials down by 0.18% and Telecom down by 0.17% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 2.28%, Bajaj Finance up by 1.96%, Ultratech Cement up by 1.86%, Reliance Industries up by 1.65% and HCL Technologies up by 1.59%. On the flip side, Power Grid Corporation of India down by 2.24%, Larsen & Toubro down by 1.33%, Bharti Airtel down by 0.76%, Axis Bank down by 0.72% and Hindustan Unilever down by 0.65% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has increased the policy repo rate under the liquidity adjustment facility (LAF) by 25 basis points to 6.50 per cent with immediate effect. Consequently, the standing deposit facility (SDF) rate stands adjusted to 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate to 6.75 per cent.

RBI’s Monetary Policy Committee (MPC) also decided to remain focused on withdrawal of accommodation to ensure that inflation remains within the target going forward, while supporting growth. These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.

On the inflation front, inflation is projected at 6.5 per cent in 2022-23, with Q4 at 5.7 per cent. On the assumption of a normal monsoon, CPI inflation is projected at 5.3 per cent for 2023-24, with Q1 at 5.0 per cent, Q2 at 5.4 per cent, Q3 at 5.4 per cent and Q4 at 5.6 per cent, and risks evenly balanced. On the economic growth front, real GDP growth for 2023-24 is projected at 6.4 per cent with Q1 at 7.8 per cent, Q2 at 6.2 per cent, Q3 at 6.0 per cent and Q4 at 5.8 per cent, and risks broadly balanced.

The CNX Nifty is currently trading at 17838.00, up by 116.50 points or 0.66% after trading in a range of 17744.15 and 17880.40. There were 32 stocks advancing against 18 stocks declining on the index.

The top gainers on Nifty were Adani Enterprises up by 10.82%, Adani Ports and Special Economic Zone up by 6.21%, HDFC Life Insurance up by 3.77%, SBI Life Insurance up by 2.93% and Infosys up by 2.19%. On the flip side, Power Grid Corporation of India down by 2.24%, Coal India down by 2.00%, Hero MotoCorp down by 2.00%, Eicher Motors down by 1.76% and Larsen & Toubro down by 1.17% were the top losers.

Asian markets were trading mixed; Nikkei 225 slipped 79.01 points or 0.29% to 27,606.46, Hang Seng declined 32.74 points or 0.15% to 21,265.96, Shanghai Composite weakened 15.72 points or 0.48% to 3,232.37 and Jakarta Composite plunged 3.99 points or 0.06% to 6,931.31, while Taiwan Weighted added 217.26 points or 1.41% to 15,618.17, Straits Times rose 9.13 points or 0.27% to 3,389.97 and KOSPI increased 31.93 points or 1.29% to 2,483.64.