Sensex 400 pts higher at 76,900; Mid, Smallcap, Realty, Metal indices gain 1%

Indian benchmark equity indices BSE Sensex and Nifty50 were trading higher on Wednesday, shaking off muted global cues.

At 11 AM, the BSE Sensex was higher by 435.46 points, or 0.57 per cent at 76,935.09, and the Nifty50 was at 23,285.10, ahead by 109.05 points or 0.47 per cent.

After the opening bell, at around 10:30 AM, more than half the stocks, at 18 out of the 30 stock on the BSE Sensex, were trading higher. Gains were led by Power Grid Corp (up 3.72 per cent), followed by NTPC, Maruti Suzuki, Zomato, and Kotak Mahindra Bank, while losses were capped by Bajaj Finserv (down 3.89 per cent), followed by Bajaj Finance, Axis Bank, Nestle India, and Mahindra & Mahindra.

On the Nifty 50, 29 out of the 50 stocks were trading higher, with gains led by Power Grid Corp (up 3.88 per cent), followed by NTPC, Maruti Suzuki India, Coal India, and Kotak Mahindra Bank, while losses were capped by Bajaj Finserv (down 3.48 per cent), followed by Bajaj Finance, Shriram Finance, SBI Life, and Axis Bank.

Across the sectors, the Pharma and Healthcare indices were the top drags, falling 1.22 per cent, followed by 1.14 per cent, respectively. The Consumer Durables and FMCG indices were also trending lower by 0.57 per cent and 0.52 per cent, apart from the Financial Servies index.

On the flip side, the Realty index had climbed the most, gaining 1.04 per cent, followed by the Energy index (up 0.80 per cent). Other indices trading with gains included Metal, PSU Bank, IT, Bank, Auto, and Private Bank.

In the broader markets, the Nifty Midcap 100 was ahead by 0.42 per cent and the Nifty Smallcap 100 was higher by 0.24 per cent.

While markets in the US remained cautious and closed on a mixed and muted note overnight amid volatile trading ahead of retail inflation numbers scheduled for release later today, which will bring some clarity to the expected path for policy easing that the Federal Reserve is likely to take at its next rate setting policy later in the month.

Meanwhile, markets in India found some support from domestic investors even as foreign portfolio investors continue to book profits on any rise in equities here.

The trend is likely to continue, as closer home, investors are looking at third quarter earnings from companies here to get a sense of direction for the economy, while awaiting the Budget 2025 and the Reserve Bank of India’s policy meeting next month.

Separately, foreign institutional investors net sold Indian equities worth Rs 8,132.26 crore on Tuesday, while domestic institutional investors net bought shares worth Rs 7,901.06 crore during the trading session.

Elsewhere, amid speculation of a change in the foreign exchange intervention policy by the RBI, market sources said the stance is likely to have remained the same, with the central bank continuing to intervene to curb excess volatility without targeting any specific level or range.

On Tuesday, the rupee hit a fresh low of 86.69 per dollar (intraday) as foreign investors and oil importers continued to stock up on dollars, dealers said. The domestic currency regained some ground by the end of the trade, settling at 86.64 per dollar, a closing low. READ MORE

In other news, the RBI has redistributed the portfolios of the deputy governor’s after Michael Patra demitted office on Tuesday.

Deputy Governor M Rajeshwar Rao, who is in charge of banking regulation, has been allocated the all-important monetary policy department, as well as department of economic and policy research. These two portfolios, among others, were with Patra. Some of the other portfolios of Patra were distributed with other deputy governors. RBI has four deputy governors. READ MORE

That apart, discussions on a term deal for crude oil purchases from Russia have ground to a halt in the wake of the latest sanctions on Russia, sources in the Ministry of Petroleum said. READ MORE

Separately, India’s insurance market is projected to be the G20’s fastest-growing economy over the next five years, with total premium volumes — life and non-life — up 7.3 per cent in real terms on average each year aided by macroeconomic stability and the conducive regulatory environment, a report said on Tuesday. READ MORE

Meanwhile, even as the equity market has corrected sharply in the past few months, valuations in midcaps and smallcaps are concerning, according to Sankaran Naren, executive director and chief investment officer of ICICI Prudential Mutual Fund. In an interview with Business Standard’s Abhishek Kumar in Mumbai, Naren says investors should take a hybrid approach to navigate global uncertainties. READ MORE

In the previous trading session, benchmark equity indices BSE Sensex and Nifty50 snapped their 4-day losing streak to settle higher on Tuesday. The 30-share Sensex added 169.62 points, or 0.22 per cent, to settle at 76,499.63, while the Nifty50 settled in the green at 23,176.05, with gains of 90.10 points, or 0.39 per cent.

Notably, Adani group shares, including Adani Power, Adani Green Energy, Adani Energy Solutions, Adani Total Gas, Adani Ports and Special Economic Zone, ACC, and Ambuja Cements, were in focus on Tuesday as they ended higher by up to 20 per cent.

Among the broader markets, the Nifty Midcap100 and Nifty Smallcap100 ended with gains of 2.45 per cent, and 1.98 per cent, respectively, while barring the Nifty IT and FMCG indices, all the sectoral indices on the NSE settled in positive territory on Tuesday.

Banking stocks were buzzing in trade as the NIFTY PSU Bank index ended higher by 4.20 per cent, while the Bank Nifty and Nifty Private Bank indices ended higher by 1.43 per cent and 1.14 per cent, respectively.

Among others, the Nifty Auto, Metal, Media, Financial Services and Energy indices ended higher by up to 3.98 per cent.

That apart, in the primary markets today, the subscription window for Laxmi Dental Limited IPO in the mainline section and Barflex Polyfilms Limited IPO in the SME section will close today, while Kabra Jewels Limited IPO and Rikhav Securities Limited IPO in the SME section will open for suscription today. The basis of allotment for Sat Kartar Shopping Limited IPO will get finalised today.

Elsewhere, markets in the Asia-Pacific region were mostly higher on Wednesday, following a similar trend on Wall Street overnight.

Hong Kong’s Hang Seng index was 0.03 per cent higher while mainland China’s CSI300 — which captures the 300 most traded stocks on Shanghai and Shenzhen Stock Exchanges — was lower by 0.57 per cent.

Japan’s benchmark Nikkei 225 climbed 0.38 per cent and the broad-based Topix gained 0.66 per cent.

South Korea’s Kospi was up 0.13 per cent and the small-cap Kosdaq Index lost 0.51 per cent. South Korean investigators have reportedly arrested impeached President Yoon Suk Yeol for a second time, according to local reports.

Australia’s S&P/ASX 200 gained 0.11 per cent.

Meanwhile, US Treasury yields dipped while the S&P 500 ended slightly higher on Tuesday after data showed US producer prices rose less-than-expected in December, but investors remained cautious ahead of US consumer price data on Wednesday and the start of quarterly earnings reports.

The US producer price index climbed 0.2 per cent month-on-month in December, below expectations for a 0.3 per cent increase and down from 0.4 per cent in November.

Investors have been worried about persistent US inflation. The PPI report did not change the view that the Federal Reserve would not cut interest rates again before the second half of this year, and investors still await the more closely watched US consumer price index report.

CPI data is expected to show month-on-month inflation held at 0.3 per cent in December while the year-on-year figure climbed to 2.9 per cent, from 2.7 per cent in November.

Investors are also gearing up for US fourth-quarter 2024 earnings, with results from some of the biggest US banks due starting Wednesday. Lenders were expected to report stronger earnings, fuelled by robust dealmaking and trading.

The S&P 500 shifted between gains and losses throughout the session before ending 0.1 per cent higher. The Dow also ended the day higher, while the Nasdaq finished lower.

The Dow Jones Industrial Average rose 221.16 points, or 0.52 per cent, to 42,518.28, the S&P 500 rose 6.69 points, or 0.11 per cent, to 5,842.91 and the Nasdaq Composite fell 43.71 points, or 0.23 per cent, to 19,044.39.

MSCI’s gauge of stocks across the globe rose 2.62 points, or 0.31 per cent, to 834.41. The STOXX 600 index fell 0.08 per cent.

The potential for tariffs that could boost inflation once President-elect Donald Trump is in office also hangs over the market.

Bloomberg reported that Trump’s aides were weighing ideas including increasing tariffs by 2 per cent to 5 per cent a month to increase US leverage and to try to avoid an inflationary spike.

The yield on the benchmark 10-year Treasury note eased, but it remained close to its 14-month high.

It was last down slightly at 4.788 per cent after hitting 4.805 per cent overnight, the highest since November 2023.

Higher yields have weighed on equities by making bonds relatively more attractive and increasing the cost of borrowing for companies.

The dollar weakened against the euro but stayed near its highest level in more than two years. The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.21 per cent to 109.19, with the euro down 0.03 per cent at $1.0304.

Oil prices fell after a US government agency forecast steady US oil demand in 2025 while it raised its forecast for supply. US crude fell $1.32 to settle at $77.50 a barrel and Brent dropped $1.09 to settle at $79.92.