Domestic markets trade higher with decent gains in early deals

Indian equity benchmarks extended their previous session’s gains with optimistic start on Thursday tracking overnight gains on Wall Street. Domestic markets are trading higher with decent gains in early deals. Traders took note of Reserve Bank of India Governor Shaktikanta Das’ statement that the rupee has witnessed low volatility and orderly movements as compared to its peers. Das said household inflation expectations are becoming more anchored, but added that headline inflation is vulnerable to recurring and overlapping food price shocks. However, upside remained limited amid foreign fund outflows. According to provisional data from NSE, foreign institutional investors net sold shares worth Rs 306.56 crore on Wednesday. 

On the global front, Asian markets trading mixed, despite the broadly positive cues from Wall Street overnight, dragged down by weakness in energy and mining stocks across the region due to tumbling commodity prices amid persisting worries about global economic slowdown. The Japanese market is closed on account of Workers Day.

Back home, NBFCs stocks are in focus as CRISIL Ratings said that assets under management (AUM) of non-banking financial companies (NBFCs) are set to log a 14-17 percent growth next fiscal (FY24-25) on the back of continued strong credit demand across retail loan segments. In stock specific development, Cipla tumbled after reports of manufacturing lapses at its Pithampur plant. However, shares of Honasa Consumer, the parent company of personal care brand Mamaearth, traded with traction after it posted a good set of numbers for the September quarter.

The BSE Sensex is currently trading at 66212.23, up by 188.99 points or 0.29% after trading in a range of 66067.39 and 66235.24. There were 26 stocks advancing against 4 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.23%, while Small cap index was up by 0.70%.

The gaining sectoral indices on the BSE were Realty up by 1.50%, Telecom up by 0.77%, Utilities up by 0.60%, Auto up by 0.53% and Consumer Discretionary up by 0.52%, while Healthcare down by 0.40% was the sole losing index on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 0.96%, Wipro up by 0.87%, Nestle up by 0.83%, Asian Paints up by 0.80% and Indusind Bank up by 0.79%. On the flip side, Ultratech Cement down by 0.61%, Larsen & Toubro down by 0.13%, Hindustan Unilever down by 0.11% and Sun Pharma down by 0.11% were the top losers.

Meanwhile, Reserve Bank of India Governor Shaktikanta Das said the rupee has witnessed ‘low volatility’ and orderly movements as compared to its peers. He said household inflation expectations are becoming more anchored, but added that headline inflation is vulnerable to recurring and overlapping food price shocks. He said ‘On the exchange rate front, the Indian rupee (INR) has exhibited low volatility and orderly movements relative to peers despite elevated US treasury yields and a strong US dollar’. He said this is courtesy the strength of the underlying macro-fundamentals of our economy and the reassuring forex buffers.

Crediting RBI's rate hikes, liquidity tightening moves and supply-side measures undertaken by the government for the headline consumer price inflation cooling off to 4.9 per cent in October, Das stressed that the RBI is ‘completely focused’ on getting the headline inflation down to 4 per cent. He said the monetary policy will be ‘watchful’ about the emerging trends and ‘actively disinflationary’, and added that it will be supporting growth as well. He said the softening in the core inflation gives the RBI the conviction that ‘monetary policy seems to be working’.

He also reiterated the Arjuna analogy to speak about the resolute focus of the central bank on inflation, and also borrowed from the ‘Swayamvar’ scene in the mythological text to say that just like Arjuna focusing on the bird's eye while calculating the ripples and sound in the room, the central bank also takes into account various other aspects. Meanwhile, he said household inflation expectations are becoming more anchored and cited recent surveys by the Reserve Bank which illustrate this.

The CNX Nifty is currently trading at 19867.85, up by 56.00 points or 0.28% after trading in a range of 19827.90 and 19875.15. There were 40 stocks advancing against 10 stocks declining on the index.

The top gainers on Nifty were Bajaj Auto up by 2.98%, Hero MotoCorp up by 1.86%, Eicher Motors up by 1.40%, Adani Ports & SEZ up by 1.17% and HDFC Life Insurance up by 1.01%. On the flip side, Cipla down by 2.97%, Hindalco down by 0.81%, Ultratech Cement down by 0.65%, Dr. Reddy's Lab down by 0.35% and Hindustan Unilever down by 0.16% were the top losers.

Asian markets are trading mixed; Hang Seng declined 56.87 points or 0.32% to 17,677.73, Taiwan Weighted lost 33.41 points or 0.19% to 17,276.85, KOSPI fell 2.79 points or 0.11% to 2,508.91, Straits Times was down by 2.45 points or 0.08% to 3,112.47. On the other hand, Jakarta Composite rose 85.97 points or 1.24% to 6,992.92 and Shanghai Composite was up by 5.21 points or 0.17% to 3,048.82.