Sensex, Nifty wipe out opening losses to trade higher ahead of key macro data

Indian equity benchmarks made negative start on Thursday tracking overnight weakness on Wall Street as well as mixed cues from Asian counterparts, as traders continue to be cautious ahead of the release of key U.S. inflation data later in the day. The inflation data is likely to have a notable impact on the outlook for interest rates, as US Fed officials have said they need greater confidence that inflation is slowing before cutting rates. Domestically, Sensex and Nifty soon managed to wipe out their losses and are treading slightly higher in early deals on account of value buying after previous session’s sharp fall. Initial markets witnessed volatility ahead of the impending expiry of February series derivative contracts. 

However, some support came in as economic think tank National Council of Applied Economic Research (NCAER) in report said that high frequency indicators reveal that the Indian economy remains resilient with Purchasing Manager's Index (PMI) for services accelerating and manufacturing regaining momentum. Meanwhile, investors are keeping close eye on India’s Q4 GDP data to be out later in the day. There are expectations that India's economic growth probably slipped below 7% for the first time in the current fiscal year in the October-December period, hit by a tepid manufacturing sector and weakness in consumption. 

In stock specific development, Reliance Industries was up over 1 per cent after the Mukesh Ambani-led firm, Viacom18 Media and The Walt Disney entered into an agreement to create a $8.5 billion entertainment giant in India.

The BSE Sensex is currently trading at 72536.11, up by 231.23 points or 0.32% after trading in a range of 72188.44 and 72565.44. There were 20 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.04%, while Small cap index was down by 0.26%.

The top gaining sectoral indices on the BSE were Metal up by 0.54%, Consumer Durables up by 0.42%, Bankex up by 0.30%, Energy up by 0.28% and Telecom up by 0.27%, while Healthcare down by 0.82%, Industrials down by 0.39%, Realty down by 0.27%, Capital Goods down by 0.26% and Power down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 1.31%, Maruti Suzuki up by 1.17%, Titan Co up by 1.08%, Indusind Bank up by 1.00% and SBI up by 0.90%. On the flip side, Hindustan Unilever down by 0.77%, Power Grid down by 0.52%, Sun Pharma down by 0.50%, Axis Bank down by 0.39% and Tata Motors down by 0.27% were the top losers.

Meanwhile, expressing optimism over India’s growth prospects, economic think tank National Council of Applied Economic Research (NCAER) in its latest report has said that high frequency indicators reveal that the Indian economy remains resilient with Purchasing Manager's Index (PMI) for services accelerating and manufacturing regaining momentum. Further, NCAER said the composite PMI accelerated to 61.2 in January from 58.5 in December 2023.

It added that PMI for manufacturing activity accelerated to 56.5 in January from 54.9 in December 2023, reflecting an expansionary momentum while PMI for services went up to 61.8 in January from 59 in December 2023. It highlighted that the markers for the month like PMI and GST collections point to a resilient macroeconomic environment.

NCAER Director General Poonam Gupta said ‘An encouraging signal comes from easing of inflationary pressure, especially the moderation in food price inflation’. The report mentioned about healthy GST collections which reached a value of Rs 1.7 lakh crore in January, registering a year-on-year growth of 10.4 per cent. Sequentially, GST collections increased 4.4 percent.

The CNX Nifty is currently trading at 22015.25, up by 64.10 points or 0.29% after trading in a range of 21887.10 and 22022.40. There were 29 stocks advancing against 20 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Maruti Suzuki up by 1.31%, Reliance Industries up by 1.26%, Titan Company up by 1.10%, Indusind Bank up by 1.08% and Tata Consumer Products up by 0.95%. On the flip side, Bajaj Auto down by 1.86%, Apollo Hospital down by 1.13%, UPL down by 1.06%, BPCL down by 0.97% and Divi's Lab down by 0.84% were the top losers.

Asian markets are trading mixed; Nikkei 225 slipped 148.32 points or 0.38% to 39,059.71, Jakarta Composite fell 5.74 points or 0.08% to 7,322.90, KOSPI dropped 5.45 points or 0.21% to 2,646.84 and Straits Times was down by 0.97 points or 0.03% to 3,137.96. On the other hand, Hang Seng advanced 24.68 points or 0.15% to 16,561.53, Shanghai Composite added 21.71 points or 0.73% to 2,979.56 and Taiwan Weighted was up by 16.1 points or 0.09% to 18,870.51.