Sensex, Nifty hold gains amid easing wholesale inflation

Indian equity benchmarks were holding their strong gains in early afternoon deals, aided by heavy buying at IT and TECK sticks along with positive cues from other Asian markets. Traders got encouragement after India’s inflation based on wholesale price index (WPI) eased further to 4.73% for the month of January 2023 against 4.95% recorded in December 2022. Decline in the rate of inflation in January is primarily contributed by mineral oils, chemicals & chemical products, textiles, crude petroleum & natural gas, textiles, and food products. The wholesale inflation was 5.85% in November 2022.  

On the global front, Asian markets were trading mostly in green, after Japan's gross domestic product expanded a seasonally adjusted 0.2 percent on quarter in the fourth quarter of 2022. That was shy of expectations for an increase of 0.6 percent following the downwardly revised 0.3 percent contraction in the third quarter (originally -0.2 percent). On an annualized basis, GDP added 0.6 percent - again missing forecasts for an increase of 2.0 percent following the downwardly revised 1.0 percent decline in the three months prior (originally -0.8 percent).

Back home, auto stocks were in focus, as Society of Indian Automobile Manufacturers' (SIAM's) Director General Rajesh Menon has said that passenger vehicle (PV) wholesales rose 17 per cent to 2,98,093 units in January 2023 driven by robust offtake of utility vehicles, including the fast-growing sports utility vehicles. The overall passenger vehicle dispatch from companies to dealers was 2,54,287 units in January 2022. 

The BSE Sensex is currently trading at 60929.26, up by 497.42 points or 0.82% after trading in a range of 60550.25 and 60950.26. There were 19 stocks advancing against 10 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.42%, while Small cap index down by 0.51%.

The top gaining sectoral indices on the BSE were IT up by 1.41%, TECK up by 1.29%, FMCG up by 0.94%, Metal up by 0.35% and Energy up by 0.30%, while Utilities down by 2.06%, Realty down by 1.95%, Power down by 1.72%, PSU down by 0.48% and Industrials down by 0.37% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 2.42%, HCL Tech. up by 2.40%, Tech Mahindra up by 2.01%, Reliance Industries up by 1.93% and Infosys up by 1.70%. On the flip side, NTPC down by 1.67%, Power Grid down by 1.25%, Indusind Bank down by 0.55%, Sun Pharma down by 0.51% and Larsen & Toubro down by 0.51% were the top losers.

Meanwhile, India’s retail inflation or consumer price index (CPI) breached the Reserve Bank of India’s (RBI’s) comfort zone and rose to a three-month high of 6.52 per cent in January 2023, mainly on account of a spike in food prices. The CPI was at 5.72 per cent in December 2022 and 6.01 per cent in January 2022. The Reserve Bank has been mandated by the central government to ensure the retail inflation remains at 4 per cent with a margin of 2 per cent on either side.

The National Statistical Office (NSO) under Ministry of Statistics and Programme Implementation in its data has showed that Rural CPI (General) in January 2023 stood at 6.85 per cent as against 6.05 per cent in December 2022. The Urban CPI (General) stood at 6.00 per cent in January as against 5.39 per cent in December. The index value for Rural, Urban and Combined CPI (General) stood at 177.8, 174.9 and 176.5 respectively, in January 2023.

Inflation in the food basket was at 5.94 per cent in January 2023 as against 4.19 per cent in December 2022. Inflation rate for vegetables contracted 11.70 per cent against a contraction of 15.08 per cent last month. Meanwhile, inflation rate for fuel and light decreased mildly to 10.84 per cent against 10.97 per cent in the preceding month. Inflation rate for cereals came in at 16.12 per cent as against 13.79 per cent in December.

The CNX Nifty is currently trading at 17896.25, up by 125.35 points or 0.71% after trading in a range of 17800.05 and 17905.85. There were 29 stocks advancing against 20 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were UPL up by 3.09%, HCL Tech. up by 2.46%, ITC up by 2.42%, Reliance Industries up by 1.92% and Tech Mahindra up by 1.90%. On the flip side, Adani Enterprises down by 3.89%, NTPC down by 1.67%, Power Grid down by 1.25%, SBI Life Insurance down by 1.22% and Apollo Hospital down by 1.12% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 175.45 points or 0.64% to 27,602.77, Taiwan Weighted added 110.2 points or 0.7% to 15,654.48, KOSPI increased 12.94 points or 0.52% to 2,465.64, Jakarta Composite gained 12.82 points or 0.19% to 6,912.96 and Shanghai Composite strengthened 5.87 points or 0.18% to 3,290.03, while Straits Times fell 3.41 points or 0.1% to 3,321.29 and Hang Seng declined 35.97 points or 0.17% to 21,128.45.