Key gauges snap 2-day losing run to end higher on Tuesday

Indian equity benchmarks snapped their two-day losing run to end nearly a per cent higher on Tuesday, as supportive global cues and healthy buying in heavyweights lifted sentiment. Equity benchmarks made a positive start and traded in fine fettle in early deals as the data with the BSE showing that Foreign Portfolio Investors (FPIs) remained net buyers on Monday, purchasing shares worth Rs 1,322.39 crore. 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.  Sliding crude oil prices in the international markets also bolstered sentiment.

Sentiments remained up-beat in late afternoon deals, even as the government data showing that India's retail inflation breached the 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 inflation rate based on the Consumer Price Index (CPI) stood at 5.72 per cent in December and 6.01 per cent in January 2022. Meanwhile, Commerce and industry minister Piyush Goyal has urged member countries of the IPEF group to focus on early deliverables which can benefit all the nations. Indo-Pacific Economic Framework (IPEF) was launched by the US and other partner countries of the Indo-Pacific region on May 23 last year in Tokyo. The 14 partner countries represent 40 per cent of global GDP and 28 per cent of global goods and services trade. 

On the global front, Asian markets settled mostly higher on Tuesday, while European markets were trading higher as investors pinned hopes that key U.S. inflation data for January due later in the day will show downward pressure on prices year-on-year. U.S. consumer prices are expected to show a monthly increase in January, although the annual rate of growth is expected to slow to 6.2 percent from 6.5 percent in the previous month.

Finally, the BSE Sensex rose 600.42 points or 0.99% to 61,032.26 and the CNX Nifty was up by 158.95 points or 0.89% to 17,929.85.

The BSE Sensex touched high and low of 61,102.74 and 60,550.25, respectively. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 0.44%, while Small cap index was down by 0.61%.

The top gaining sectoral indices on the BSE were TECK up by 1.00%, IT up by 0.97%, FMCG up by 0.91%, Bankex up by 0.85% and Metal up by 0.75%, while Realty down by 1.80%, Utilities down by 1.71%, Power down by 1.35%, Industrials down by 0.46% and Healthcare down by 0.44% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 3.31%, Reliance Industries up by 2.35%, Bajaj Finance up by 1.84%, ICICI Bank up by 1.78% and Infosys up by 1.61%. On the flip side, NTPC down by 1.10%, Sun Pharma down by 0.88%, Ultratech Cement down by 0.80%, Larsen & Toubro down by 0.66% and Titan Company down by 0.50% 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 traded in a range of 17,954.55 and 17,800.05. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were UPL up by 3.61%, ITC up by 3.14%, Reliance Industries up by 2.44%, Adani Ports &SEZ up by 2.06% and Adani Enterprises up by 1.88%. On the flip side, Apollo Hospital down by 2.45%, Eicher Motors down by 2.23%, SBI Life Insurance down by 1.54%, BPCL down by 1.16% and Grasim Industries down by 1.15% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 36.6 points or 0.46% to 7,984.20, France’s CAC rose 34.85 points or 0.48% to 7,243.44 and Germany’s DAX gained 58.56 points or 0.38% to 15,455.90.

Asian markets settled mostly higher on Tuesday tracking Wall Street gains overnight, despite cautious mood ahead of key US inflation data due later in the day. Chinese shares gained after reports that US Secretary of State Antony Blinken is considering meeting top Chinese diplomat Wang Yi in Munich this week after the United States shot down a series of unidentified objects. Japanese shares rose, in spite of data showing that the Japanese economy grew much less than expected in the fourth quarter. Meanwhile, Japan announced its nomination of Kazuo Ueda as the new Bank of Japan governor.