Markets make cautious start ahead of macro-economic data

Indian equity benchmarks made cautious start on Thursday and are trading flat in early deals tracking broadly positive cues from Wall Street overnight as well as Asian counterparts, amid optimism about the outlook for interest rates following the release of the closely watched US inflation data that came in line with estimates. The report has increased confidence that the US Fed will lower interest rates by another quarter-point next week. Traders remained on sidelines ahead of consumer price index (CPI) and index industrial production (IIP) data to be out later in the day for more directional cues. There are expectations that India retail inflation likely fell to 5.53 per cent in November after breaching the central bank's 6 per cent upper tolerance band as the arrival of fresh produce to markets moderated soaring vegetable prices. Some support also came with a private report that India is drawing global attention from investors due to its stable government, robust legal system, and fast-paced economic growth.

On the sectoral front, stocks related to logistics sector are in focus as Union Minister for Road Transport and Highways, Nitin Gadkari said that changes in the cost of fuel and road can bring the logistics cost to nine per cent. The Union Minister stated that savings made by reducing the fuel and road cost will significantly help the state to strengthen its export capabilities. In stock specific development, Reliance Power jumped after it formed a new arm for renewable energy business.

The BSE Sensex is currently trading at 81565.77, up by 39.63 points or 0.05% after trading in a range of 81444.92 and 81680.97. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.13%, while Small cap index was down by 0.46%.

The few gaining sectoral indices on the BSE were IT up by 1.08%, TECK up by 1.03% and Telecom up by 0.28%, while Utilities down by 0.82%, Power down by 0.78%, PSU down by 0.66%, Capital Goods down by 0.58% and Basic Materials down by 0.56% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 2.22%, Infosys up by 1.07%, TCS up by 1.03%, Bharti Airtel up by 0.89% and HCL Technologies up by 0.71%. On the flip side, Titan Company down by 1.35%, Tata Motors down by 1.23%, NTPC down by 0.97%, Larsen & Toubro down by 0.74% and Tata Steel down by 0.70% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has stressed that India Inc’s commercial considerations should blend with the economy, nation’s priorities and strategic needs. Asking the industry to “realign and reset” itself based on the lessons learnt in the last decade, Sitharaman said the supply chains should be widespread lest geopolitical risks disrupt it. Outlining the priorities of the economy for the next decade, she said the industry should work with small and medium enterprises to explore how they can support large units, while equally contributing to job creation.

She said ‘When we talk about restoring supply chains to frictionless supply chains, let’s not forget it’s not just economics, it’s more than that… We have to build in our own decision making not just in economic sense but also in a political and strategic sense. Supply chains will have to be restored but you would have to reset it, realign it, you will have to make sure that it is spread so much that no geopolitical or strategic risks will threaten our wellbeing’.

Learning from the last decade are that the country will have to now realign, and industry will have to realign itself not just on economic principles. Sitharaman said the attempt of both industry and governments everywhere should be to restore global calm and normalcy. There can nowhere be enough justifiable reason for skirmishes or war. She added ‘The global priority for this decade should be to restore normalcy. They are the main cause for disruptions in supply chain, inflation and other global challenges’.

Stating that the benefits of economic success will be spread properly only through technology. India’s Digital Public Infrastructure (DPI), ONDC (Open Network for Digital Commerce) and technology stack for agriculture have democratised access. She also said ‘Farmers are now able to access the global markets due to the advantage of technology. I’m sure that ‘Agri Stack’ will be the next big thing you will hear coming out of India’. She added ‘The world is facing challenges which are reflected in the economy’. She said industry will have to look at ways to adapt with newer challenges, and added that scale cannot be the only criteria.

The CNX Nifty is currently trading at 24633.00, down by 8.80 points or 0.04% after trading in a range of 24604.45 and 24675.25. There were 15 stocks advancing against 35 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 2.10%, Wipro up by 1.15%, TCS up by 1.01%, Bharti Airtel up by 0.87% and Infosys up by 0.77%. On the flip side, Apollo Hospital down by 1.46%, Titan Company down by 1.40%, Tata Consumer Products down by 1.38%, Tata Motors down by 1.28% and BPCL down by 1.07% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 516.94 points or 1.31% to 39,889.17, Hang Seng jumped 354.68 points or 1.76% to 20,509.73, Taiwan Weighted rose 219.83 points or 0.96% to 23,123.46, Shanghai Composite strengthened 22.03 points or 0.64% to 3,454.52, Straits Times added 15.62 points or 0.41% to 3,808.44 and KOSPI was up by 8.61 points or 0.35% to 2,451.12, while Jakarta Composite was down by 50.99 points or 0.68% to 7,413.76.