Stock indices open flat amid mixed global signals
Stock indices opened flat amid mixed global indices. As of 9:16 a.m., the Sensex was down 15.63 points or 0.03% at 61,134.41. The Nifty was down 7.30 points or 0.04% at 18,205. About 1,413 stocks were up, 756 stocks were down and 112 stocks were unchanged.
Early Nifty winners included Power Grid, Infosys, TCS, Tata Steel and Sun Pharma. Wipro, M&M, Tech Mahindra, HCL Technologies and Kotak Mahindra Bank were among the big losers.
Nifty rose for the fourth consecutive session on January 12, helped by positive global signals, the receding Omicron threat and the recovery in FPI flows. At the close, Nifty was up 0.87% or 156.6 points at 18,212.3. In the process, the Nifty closed at its highest level in 10 weeks.
Nifty continues its ascent with volumes now back to normal and an advanced rate of decline also ending in the positive. The Nifty however shows a doji after a rise and a gap up. Breaking through and holding above the January 12 high of 18,228 will be crucial for the uptrend to continue. On a dip, 18,081 could offer support.
Mixed Asian stocks
Asian stocks were mixed in early trading on Thursday after a US inflation release intensified calls for higher interest rates as early as March.
US stocks close higher
U.S. stock indexes closed with modest gains on Wednesday after a reading on inflation hit a near four-decade high. Stocks were buoyed on Wednesday as investors exhaled relief after the latest inflation reading, while hot, was no worse than expected
The S&P 500 gained 12.70 points, or 0.27%, to end at 4,725.77 points, while the Nasdaq Composite gained 34.27 points, or 0.23%, to 15,187.72. The Dow Jones Industrial Average rose 44.59 points, or 0.12%, to 36,296.61.
US CPI up
The consumer price index posted a monthly increase of 0.5 oercebt in December, as prices rose 7% in almost 40 years from a year ago, while also indicating that high inflation in the United States could persist until 2022.
In other economic news, the Federal Reserve’s latest Beige Book report on economic conditions showed solid growth in companies’ ability to pass on price gains to customers in December, a change from recent years. .
The yield on the 10-year Treasury fell 2.1 basis points to 1.724%.
The dollar fell to a two-month low against a basket of currencies on Wednesday after data, which showed an expected surge in U.S. consumer prices in December, failed to give further momentum to efforts to normalize the Federal Reserve policy.
Rise in retail price inflation
The Industrial Production Index (IIP), which measures the output of factories, recorded a 1.4% year-on-year growth in November, mainly due to the strong performance seen in the mining sector followed by the construction sector. electricity, said Mohit Nigam.
Headline CPI inflation in India rose 70 basis points to 5.6% in Dec 21 from 4.9% in Nov 21, although the print was slightly below consensus expectations of 5 .8%. The increase in the CPI was driven by higher food inflation (doubled to 4% from the previous month), the decrease in the favorable base effect and the increase in core inflation (CPI excluding food and fuel) and fuel inflation, Jasani said. PII rose 1.4% in Nov 21 from 4.0% in Oct 21, despite a favorable base (Nov 20 reading: -1.6%). Although the slowdown was broad-based, manufacturing, capital goods and the production of durable consumer goods were hit hard.
Focus on IT stocks
India’s largest software exporter, TCS, reported better-than-expected quarterly earnings, beating all high street expectations. The repurchase quantum is far above what we expected and the repurchase rate at Rs 4,500 premium of 16.67% over the last traded price of the stock is also beyond high street expectations, said Prashant Tapse, Vice President (Research) at Mehta Equities Ltd.
Infosys announced better-than-expected quarterly results, exceeding all street expectations. The company raised its growth forecast for FY22 to 19.5%-20% from 16.5%-17.5%, which was above our expectations, Tapse said. The stock may react positively from Wednesday’s close of Rs 1876, and we are broadly bullish on the stock with a medium to long term horizon with a technical target above Rs 2,000 over a 6-12 month period, Tapse added.
Wipro reported quarterly earnings in line with Street expectations, including CC’s future guidance. In terms of revenue, Wipro missed Street’s expectations and margins were in line with expectations, while net profit was nearly flat from the Rs 2,968 crore reported a year ago, Tapse said.
Based on the results, we expect the stock to react slightly lower from Wednesday’s close of Rs 691 and give scope to build up in the Rs 660-675 range. We are broadly bullish on equities over the medium to long term, Tapse said.
Five stocks under F&O ban
Five stocks – Delta Corp, Indiabulls Housing Finance, Vodafone Idea, RBL Bank and SAIL – have been under the F&O ban since January 13.
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Posted: Thursday January 13th 2022, 09:22 IST