Sensex, Nifty trim gains

Indian equity benchmarks trimmed some of their gains in early afternoon deals, amid selling at Utilities and Power counters, despite positive cues from other Asian markets. Some concerns came amid a private report stating that  India's retail inflation likely picked up in November due to higher food prices after declining for three months, bringing it closer to the upper end of the Reserve Bank of India's (RBI) 2 percent-6 percent target range. Besides, another report stated that India's fuel consumption in November fell after hitting a four month peak in the previous month, hit by reduced travel in the world's third biggest oil consumer as a festive boost fizzled out.

On the global front, Asian markets were trading mostly in green, after a measure of public opinion about the Japanese economy remained stable in November after weakening in the previous three 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, held steady at 49.5 in November. However, any reading below 50 indicates pessimism. Household activities showed an increase, while cooperative activities contributed to the decrease in the overall index.

The BSE Sensex is currently trading at 69706.41, up by 184.72 points or 0.27% after trading in a range of 69606.69 and 69888.33. There were 15 stocks advancing against 14 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.24%, while Small cap index was down by 0.20%.

The top gaining sectoral indices on the BSE were IT up by 0.77%, TECK up by 0.67%, Capital Goods up by 0.61%, Realty up by 0.25% and Metal up by 0.25%, while Utilities down by 1.72%, Power down by 1.66%, Oil & Gas down by 1.10%, Auto down by 0.92% and Healthcare down by 0.62% were the top losing indices on BSE.

The top gainers on the Sensex were HCL Tech. up by 2.70%, JSW Steel up by 2.14%, HDFC Bank up by 1.34%, Larsen & Toubro up by 1.27% and Infosys up by 0.91%. On the flip side, Mahindra & Mahindra down by 1.69%, Bajaj Finance down by 1.28%, Tata Motors down by 0.93%, Maruti Suzuki down by 0.87% and ITC down by 0.80% were the top losers.

Meanwhile, the Reserve Bank of India’s (RBI’s) Monetary Policy Committee (MPC) has decided to Keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 per cent. The standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent. The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth.

These decisions are in consonance with the objective of achieving the mediumterm 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, the MPC highlighted that CPI headline inflation fell by about 2 percentage points since the last meeting of the MPC to 4.9 per cent in October 2023 on sharp correction in prices of certain vegetables, deflation in fuel and a broadbased moderation in core inflation (CPI inflation excluding food and fuel). Taking into account these factors, CPI inflation is projected at 5.4 per cent for 202324, with Q3 at 5.6 per cent; and Q4 at 5.2 per cent. Assuming a normal monsoon next year, CPI inflation for Q1:202425 is projected at 5.2 per cent; Q2 at 4.0 per cent; and Q3 at 4.7 per cent.

On the economic growth front, it stated that continued strengthening of manufacturing activity, buoyancy in construction, and gradual recovery in the rural sector are expected to brighten the prospects of household consumption. Healthy balance sheets of banks and corporates, supply chain normalisation, improving business optimism, and rise in public and private capex should bolster investment going forward. With improvement in exports, the drag from external demand is expected to moderate. Headwinds from the geopolitical turmoil, volatility in international financial markets and geoeconomic fragmentation pose risks to the outlook. Taking all these factors into consideration, real GDP growth for 202324 is projected at 7.0 per cent with Q3 at 6.5 per cent; and Q4 at 6.0 per cent. Real GDP growth for Q1:202425 is projected at 6.7 per cent; Q2 at 6.5 per cent; and Q3 at 6.4 per cent.

The CNX Nifty is currently trading at 20927.70, up by 26.55 points or 0.13% after trading in a range of 20927.25 and 21006.10. There were 20 stocks advancing against 29 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were HCL Tech. up by 2.63%, LTIMindtree up by 2.57%, JSW Steel up by 2.12%, Larsen & Toubro up by 1.49% and HDFC Bank up by 1.31%. On the flip side, Adani Ports & SEZ down by 2.98%, Adani Enterprises down by 2.81%, Hero MotoCorp down by 1.84%, Mahindra & Mahindra down by 1.64% and Divi's Lab down by 1.63% were the top losers.

Asian markets were trading mostly in green; Taiwan Weighted added 105.25 points or 0.61% to 17,383.99, Jakarta Composite gained 39.86 points or 0.56% to 7,174.48, Straits Times rose 32.21 points or 1.04% to 3,106.47, Shanghai Composite strengthened 3.35 points or 0.11% to 2,969.56 and KOSPI increased 25.78 points or 1.02% to 2,517.85, while Nikkei 225 slipped 550.45 points or 1.7% to 32,307.86 and Hang Seng declined 28.47 points or 0.17% to 16,317.42.