Indian benchmark indices, the BSE Sensex and the NSE Nifty, are expected to continue their gaining momentum Thursday, following mixed cues from global peers. The bullish trends on SGX Nifty also indicated a positive opening for the Indian equities, with SGX Nifty futures trading 115 points, or 0.63%, higher at 18,331 on the Singapore Stock Exchange at 7:45 AM.
On Wednesday, the Indian share market continued its gaining streak for the fourth straight session, following firm cues overnight from Wall Street, and strong earnings expectations from IT heavyweights TCS, Wipro and Infosys. The strong gain in index heavyweights such as Reliance Industries, Infosys, ICICI Bank, Bharti Airtel, and M&M also supported the market. The BSE Sensex closed 533 points, or 0.88%, higher at 61,150, while the NSE Nifty surged 156 points, or 0.87%, to end at 18,212. In line with the benchmark indices, the broader markets also ended on stronger note. The S&P BSE Midcap index closed 1.08% higher, while the S&P BSE Smallcap index soared 0.7%. On the sectoral front, power and realty were among top performers whereas consumer durables and healthcare settled with marginal losses. The top gainer on the BSE Sensex pack was auto major Mahindra & Mahindra, which ended 4.68% higher. Some of the other notable gainers included Bharti Airtel, Reliance Industries, IndusInd Bank, and ICICI Bank.
Stocks in news
Individual companies that will be in focus in today’s trade include Infosys, Tata Consultancy Services, Wipro, Tata Motors, Titagarh Wagons, and Kotak Mahindra Bank.
Infosys: The IT major has posted robust earnings for December quarter, driven by broad-based growth and robust deal momentum. The country’s second-largest information technology firm reported an 11.8% year-on-year rise in its consolidated net profit for the quarter ended December to ₹5,809 crore. The software services company also clocked a 22.9% jump in consolidated revenues to ₹31,867 crore for the third quarter. Infosys has also raised its revenue growth estimate to 19.5-20% for the ongoing fiscal from 16.5-17.5% projected at the end of second quarter.
TCS: Tata Consultancy Services (TCS), the largest IT company in India, recorded a consolidated net profit of ₹9,769 crore during the December quarter of the current fiscal as all verticals reported double-digit growth in mid-to-high teens. Total revenue jumped to ₹48,885 crore during the quarter ended December 31, 2021, as against ₹42,015 crore during the same period a year ago, marking a growth of 16.3%. The board of TCS also approved an interim dividend of ₹7 per equity share of ₹1 each for the current fiscal.
Wipro: The IT major reported a marginal rise in consolidated net profit of ₹2,969 crore for the quarter ended December 31, 2021, as compared to ₹2,968 crore in the corresponding quarter of the previous fiscal. The revenue from operations increased substantially during the quarter under review to ₹20,313.6 crore from ₹15,670 crore in the year-ago period. Going ahead, Wipro expects revenue from its IT services business to be in the range of $2,692 million to $2,745 million during the March quarter of FY22, translating into a sequential growth of 2-4%.
Tata Motors: The auto major on Wednesday released Jaguar Land Rover (JLR) quarterly sales, which continued to be impacted by semiconducter shortages. JLR retail sales fell 37.6% YoY to 80,126 units in October-December quarter of 2021. The sales in China dropped 6.9% and in Europe it was down 6.8% QoQ.
Titagarh Wagons: The company has acquired the land and infrastructure of Precision Shipyard located in West Bengal, which will be used to boost its ship building capacity and execute the ₹400 crore order book. The land and facility was acquired under an auction sale by Union Bank of India at an undisclosed amount.
Kotak Mahindra Bank: The private sector lender has passed resolution to cap promoters' voting rights at 26%.
Here are key things investors should know before the market opens today:
Wall Street extends rally despite rise in inflation
On Wall Street, all three major U.S. indices closed higher for the second straight session on Wednesday despite the latest U.S. inflation data reinforcing bets that interest rate hike will happen sooner than expected. The US government showed the US consumer price index surged 7% in December, its highest year-on-year rise in nearly four decades. Meanwhile, the figures from the US Labor Department also revealed that the consumer price index climbed 0.5% last month, after rising 0.8% in November.
The blue-chip Dow Jones Industrial Average closed 0.11% higher, while the broader S&P 500 rose 0.28%. The tech-heavy NASDAQ Composite added 0.23%.
Going forward, investors will keep an eye on corporate earnings as some big players such as JPMorgan Chase, Citigroup Inc, and Morgan Stanley are slated to release their fourth quarter results on Friday.
Asian shares mixed on rate hike fear
Shares in the Asia-Pacific region traded mostly lower in early deals on Thursday, undermining positive cues from Wall Street. Investors turned cautious after the data showed that the U.S. inflation surged to its highest level in four decade last month, igniting fears that the Federal Reserve would soon raise interest rates.
Japan’s Nikkei 225 index was the worst performer in the regional market by falling 0.88% in early trade. China’s Shanghai Composite shed 0.13%, while South Korea’s KOSPI traded lower by 0.17%. Indonesia’s Jakarta Composite and the Straits Times Index in Singapore also traded lower with marginal losses.
Bucking the trend, Australia’s ASX 200 index surged 0.6%, while the Hang Seng index in Hong Kong gained 0.45%. Thailand’s SET Composite rallied 0.7%, while Taiwan Weighted Index edged higher in early deals.
Retail inflation rises 5.59% in December
The latest Consumer Price Index (CPI) inflation data by the Indian government showed that retail inflation jumped to 5.59% in December 2021, due to an unfavourable base effect. The data released by the National Statistical Office on January 12 showed that inflation surged to its highest level since July 2021.
Corporate earnings
Companies that will announce their December quarter results today include Tata Metaliks, Mindtree, Aditya Birla Money, and GTPL Hathway.
Among others, CESC, Athena Global Technologies, Eureka Industries, Gautam Gems, Mega Corporation, Mishtann Foods, Palm Jewels, Plastiblends India, Rotographics (India), and Surana Solar, will also release their earnings report.
Crude oil prices fall on demand concerns
Crude oil futures traded lower during early Asian trading hours on Thursday amid concern that surge in the Omicron coronavirus variant cases will have an impact on the demand recovery. According to market experts, limited production capacity and drop in investment in the sector could propel crude prices higher.
The U.S. West Texas Intermediate (WTI) Crude oil futures for February were down 0.04% at $82.61 a barrel, while the Brent oil futures for March traded 0.17% lower at $84.62 per barrel.
In the overnight trade, global benchmark Brent crude and the U.S. WTI crude settled higher, driven by tight supply and easing concerns over the spread of the Covid-19 cases.
FIIs turn net sellers, DIIs remain net buyers
Foreign institutional investors (FIIs) turned net sellers in the Indian equity market on January 12, while domestic institutional investors (DIIs) continued to remain net buyers. As per the data available on the NSE, FIIs net sold shares worth ₹1,001.6 crore, while DIIs net bought shares worth ₹1,332 crore.
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