Sensex, Nifty trade higher in early deals on positive CPI data

Indian equity benchmarks made positive start on Tuesday but soon turned volatile. Somehow Sensex and Nifty managed to keep their heads above water and are trading tad higher in early deals amid positive macro-economic data. The Ministry of Statistics and Programme Implementation data showed that India's headline retail inflation rate decelerated to a three-month low of 5.10 percent in January due to easing food prices. Foreign fund inflows also supported domestic sentiments. Foreign institutional investors (FIIs) net bought shares worth Rs 126.60 crore on February 12, provisional data from the NSE showed. Some support also came in with Reserve Bank Governor Shaktikanta Das’ statement that lower government borrowings than the market estimates will free more capital for the private sector resulting in easing of inflation and bolstering growth.

On the global front, Asian markets are trading mixed following the mixed cues from Wall Street overnight, with a few major markets in the region still closed for public holiday. Investors also remain cautious ahead of the release of US consumer price inflation data for January, which could have a significant impact on the outlook for interest rates. Markets in China, Hong Kong and Taiwan remain closed for the Lunar New Year holidays.

Back home, select PSUs stocks are in focus as MSCI added PSU stocks like - NMDC, BHEL, PNB and Union Bank to the MSCI India standard index under the February review. GMR Airports too added. In stock specific development, Paytm fell and breaks below Rs 400 as RBI dashes hopes of reviewing curbs.

The BSE Sensex is currently trading at 71164.65, up by 92.16 points or 0.13% after trading in a range of 70924.30 and 71316.39. There were 14 stocks advancing against 16 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.67%, while Small cap index was down by 1.63%.

The few gaining sectoral indices on the BSE were Bankex up by 0.67% and Healthcare up by 0.09%, while Metal down by 3.41%, Basic Materials down by 2.25%, Utilities down by 1.77%, Realty down by 1.72%, Power down by 1.70% were the top losing indices on BSE.

The top gainers on the Sensex were ICICI Bank up by 1.59%, Axis Bank up by 1.24%, Bajaj Finserv up by 0.91%, Kotak Mahindra Bank up by 0.77% and SBI up by 0.53%. On the flip side, Power Grid down by 1.70%, Tata Steel down by 1.49%, Wipro down by 1.40%, JSW Steel down by 1.34% and Tech Mahindra down by 0.86% were the top losers.

Meanwhile, a survey conducted by Federation of Indian Chambers of Commerce and Industry (FICCI) has revealed sustained and continued growth for India's manufacturing sector in the last two quarters of 2023-24 (October-March). Compared to the previous quarter, October-December, when 73 per cent of respondents had reported higher production levels, in the current January-March quarter, around 87 per cent of respondents expected either higher or the same level of production.

Responses have been drawn from over 400 manufacturing units from both large and SME segments with a combined annual turnover of over Rs 3.4 lakh crore. This upbeat assessment of Indian manufacturing is also reflected in higher-order books. As per the survey, 85 per cent of the respondents in the current January-March quarter are expecting a higher number of orders compared to the previous quarter. Domestic demand conditions also show optimism. The existing average capacity utilization in manufacturing is around 73 per cent, which reflects sustained economic activity in the sector, which is more or less the same as reported in previous surveys.

It stated the future investment outlook also looks steady, with over 50 per cent of respondents indicating plans for investments and expansions in the next six months. On the contrary, the availability of raw materials and their escalating prices, uncertainty in global demand, shortage of skilled labour, market volatility, increased power costs, unutilized capacities, and high bank interest rates, are some of the major constraints that are affecting expansion plans of the respondents.

The CNX Nifty is currently trading at 21633.15, up by 17.10 points or 0.08% after trading in a range of 21543.35 and 21678.05. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Hero MotoCorp up by 2.09%, Coal India up by 1.80%, ICICI Bank up by 1.61%, HDFC Life Insurance up by 1.39% and Divi's Lab up by 1.31%. On the flip side, Hindalco down by 13.96%, Adani Enterprises down by 1.79%, Power Grid down by 1.74%, Grasim Industries down by 1.49% and Wipro down by 1.36% were the top losers.

Asian markets are trading mixed; Nikkei 225 surged 950.74 points or 2.58% to 37,848.16, KOSPI rose 25.08 points or 0.96% to 2,645.40. On the other hand, Jakarta Composite fell 59.19 points or 0.81% to 7,238.48 and Straits Times was down by 19.57 points or 0.62% to 3,118.73.