Choppy day ends on negative note; Sensex falls 0.23%

Thursday turned out to be a choppy day of trade on the Dalal Street, with both Sensex and Nifty closing lower, as the Reserve Bank of India (RBI) and Fed minutes revealed that they are willing to keep increasing the interest rates as inflation remains a concern. After a slightly positive start, markets cut gains and traded volatile during the day, amid foreign fund outflows. Foreign institutional investors (FII) sold shares worth Rs 579.82 crore on February 22, NSE’s provisional data showed. Adding more worries among traders, the latest Department for Promotion of Industry and Internal Trade data showed that foreign direct investment (FDI) into India declined by 15 per cent to $36.75 billion during the April-December this fiscal.

Despite high volatility, indices managed to keep their heads above water for the most part of the session, as some support came with a report that ahead of the meeting of G20 finance ministers and central bank governors in Bengaluru, the International Monetary Fund (IMF) reiterated that India's strong performance remains a bright spot in an uncertain global economy. But at the end, the day ended in red. There was cautiousness in the markets, as according to the minutes of the meeting, majority of members of the high-powered Monetary Policy Committee (MPC) of the Reserve Bank were concerned about heightened inflation even as two panellists raised objections against an increase in the benchmark interest rate.

On the global front, European markets were trading mostly in green, after Germany's ifo business confidence indicator climbed for the fourth month in a row in February, underpinned by stronger expectations, suggesting the resilience of the biggest euro area economy that may indeed avoid a modest recession. Asian markets settled mostly lower, after the Directorate General of Budget, Accounting & Statistics said that Taiwan's economy is forecast to grow at a slower than previously projected pace in the face of global growth slowdown and weak domestic investment prospects despite a faster momentum in private consumption. The real growth outlook for 2023 was lowered to 2.12 percent from 2.75 percent estimated in January.

Back home, stocks related to the coal industry remained in focus as the coal ministry said that 27 coal mines would be put on sale in the next round of commercial mines auction starting from February 27. Further, stocks related to the retail industry also remained in focus, as the Retailers Association of India (RAI) and Anarock in their joint report showed that the size of the country's retail market is likely to grow from $690 billion in 2021 to $2 trillion by 2032. As per the report, real estate developers plan to add nearly 25 million square feet of new mall space across seven major cities over the next 4-5 years. It also noted that in 2022, these seven cities added over 2.6 million sq ft of mall space, up 27 per cent from the preceding year.

Finally, the BSE Sensex fell 139.18 points or 0.23% to 59,605.80 and the CNX Nifty was down by 43.05 points or 0.25% to 17,511.25.

The BSE Sensex touched high and low of 59,960.04 and 59,406.31, respectively. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices ended mixed; the BSE Mid cap index declined by 0.40%, while Small cap index was up by 0.06%.

The top gaining sectoral indices on the BSE were Metal up by 0.71%, PSU up by 0.34%, FMCG up by 0.25%, Bankex up by 0.20% and Auto up by 0.12%, while Realty down by 1.60%, Utilities down by 1.29%, Power down by 1.19%, Consumer Durables down by 0.95% and Capital Goods down by 0.84% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 1.44%, ITC up by 0.98%, SBI up by 0.86%, Tata Motors up by 0.86% and Tata Steel up by 0.67%. On the flip side, Asian Paints down by 3.20%, Larsen & Toubro down by 1.40%, Indusind Bank down by 1.30%, Bharti Airtel down by 1.29% and Titan Co down by 1.23% were the top losers.

Meanwhile, the Department for Promotion of Industry and Internal Trade in its latest data has showed that foreign direct investment (FDI) into India declined by 15 per cent to $36.75 billion during the April-December period of this fiscal year 2022-23 (FY23), as compared to the FDI inflows of $43.17 billion during the corresponding period of the previous year. The total FDI inflows, which includes equity inflows, re-invested earnings and other capital, declined to $55.27 billion during the nine months of the current fiscal year as against $60.4 billion in the year-ago period.

The data showed that during April-December 2022-23, Singapore emerged as the top investor with $13 billion FDI. It was followed by Mauritius ($4.7 billion), the US (about $5 billion), the UAE ($3.1 billion), the Netherlands ($2.15 billion), Japan ($1.4 billion), and Cyprus ($1.15 billion).

The computer software and hardware sector attracted the highest inflows of $8 billion during the nine-month period of this fiscal. It was followed by services ($6.6 billion), trading ($4.14 billion), chemicals ($1.5 billion), automobile industry ($1.27 billion) and construction (infrastructure) activities ($1.22 billion).

The CNX Nifty traded in a range of 17,620.05 and 17,455.40. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 1.57%, Coal India up by 1.44%, Axis Bank up by 1.32%, ITC up by 0.98% and SBI up by 0.90%. On the flip side, Asian Paints down by 3.22%, Divi's Lab down by 1.62%, Larsen & Toubro down by 1.62%, Adani Enterprises down by 1.58% and Indusind Bank down by 1.57% were the top losers.

European markets were trading mostly in green; UK’s FTSE 100 decreased 37.43 points or 0.47% to 7,893.20, France’s CAC rose 19.22 points or 0.26% to 7,318.48 and Germany’s DAX gained 54.84 points or 0.36% to 15,454.73.

Asian markets settled mostly lower on Thursday after the release of the Federal Reserve's minutes from its last meeting with almost all Fed officials agreeing to hike interest rates to control inflation, while Japanese market was closed for the emperor’s birthday. However, Seoul stocks gained after South Korea's central bank, Bank of Korea kept its interest rates unchanged, in line with market expectations, and ending an uninterrupted one-year run of rises.