Gaining rally continues in Indian markets despite rising WPI inflation

A gaining rally continued in Indian equity markets despite rising WPI inflation. Inflation based on wholesale price index (WPI) surged to a nine-month high of 0.73 percent in December as against 0.26 percent in November 2023, due to increase in prices of electricity, machinery & equipment, pharmaceuticals, medicinal chemical & botanical products and electrical equipment. Bears were holding a tight grip over the Dalal Street, with heavy buying at IT, PSU and TECK counters along with positive cues from other Asian markets. 

Sentiments remained positive, amid a private report stating that net inflows into exchange traded funds (ETFs) tracking Indian stocks hit a record high in 2023, with investors may continue to buy into the world's fastest-growing major economy even as keenly watched general elections loom. Besides, Commerce and Industry Minister Piyush Goyal said the rate of rupee depreciation has come down and expressed hope that after 8-10 years, it will start appreciating against US dollar, helping the Indian economy to grow at faster pace. 

On the global front, Asian markets were trading mostly in green, as China's central bank maintained the rate on medium-term lending facility unchanged unexpectedly as any reduction would add downward pressure on the renminbi. The People's Bank of China added CNY 995 billion via the MLF, which is set to mature in one year.

The BSE Sensex is currently trading at 73167.94, up by 599.49 points or 0.83% after trading in a range of 72909.00 and 73288.78. There were 23 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.62%, while Small cap index was up by 0.20%.

The top gaining sectoral indices on the BSE were IT up by 1.74%, PSU up by 1.57%, TECK up by 1.47%, Oil & Gas up by 1.41% and Energy up by 1.31%, while Metal down by 0.11%, Power down by 0.05%, Utilities down by 0.03% and Basic Materials down by 0.02% were the top losing indices on BSE.

The top gainers on the Sensex were Wipro up by 6.97%, HCL Tech. up by 2.59%, Tech Mahindra up by 2.34%, Infosys up by 2.13% and HDFC Bank up by 1.90%. On the flip side, Bajaj Finance down by 2.10%, Bajaj Finserv down by 1.07%, Tata Steel down by 0.55%, Asian Paints down by 0.47% and Tata Motors down by 0.25% were the top losers.

Meanwhile, Society of Indian Automobile Manufacturers (SIAM) in its latest data has said that automobile shipments from India declined 21% in 2023 as many overseas markets continued to face monetary and geopolitical crises. Overall exports stood at 42,85,809 units in 2023 as compared to 52,04,966 units in 2022. Passenger vehicle shipments rose 5% to 6,77,956 units in 2023 from 6,44,842 units in 2022.

However, other segments like commercial vehicles, two-wheelers and three-wheelers saw a decline in exports last year. Two-wheeler exports slipped 20% to 32,43,673 units last year from 40,53,254 units in 2022. Similarly, commercial vehicle shipments declined to 68,473 units last year from 88,305 units. Three-wheeler exports declined 30% to 2,91,919 units last year from 4,17,178 units. 

SIAM Director General Rajesh Menon said in 2023, passenger vehicle exports were driven by vehicle launches and pent-up demand in markets like South Africa and the Gulf. The increase can also be attributed to a smoother supply chain as compared to the previous year, wherein there were supply-side disruptions, including that of semiconductors. However, he said for the regions where two and three-wheelers are sold, the challenges of availability of foreign exchange continue, which has kept the demand subdued.

The CNX Nifty is currently trading at 22056.55, up by 162.00 points or 0.74% after trading in a range of 21963.55 and 22081.95. There were 34 stocks advancing against 16 stocks declining on the index.

The top gainers on Nifty were Wipro up by 6.96%, ONGC up by 4.36%, HCL Tech. up by 2.74%, Tech Mahindra up by 2.35% and Infosys up by 2.11%. On the flip side, HDFC Life Insurance down by 3.50%, Bajaj Finance down by 2.13%, Tata Consumer Products down by 1.33%, Hindalco down by 1.21% and Bajaj Finserv down by 0.99% were the top losers.

Asian markets were trading mostly in green; Nikkei 225 surged 324.68 points or 0.9% to 35,901.79, Taiwan Weighted added 33.99 points or 0.19% to 17,546.82, Straits Times rose 10.07 points or 0.31% to 3,201.79, Shanghai Composite strengthened 4.94 points or 0.17% to 2,886.92 and KOSPI increased 0.94 points or 0.04% to 2,525.99, while Jakarta Composite plunged 24.62 points or 0.34% to 7,216.52 and Hang Seng declined 52.77 points or 0.33% to 16,191.81.