Indian benchmark indices, the BSE Sensex and the NSE Nifty, are poised on open lower on Friday, following weak cues from global peers as investors turned nervous about inflation and upcoming US interest rate hikes. The bearish trends on SGX Nifty also indicated a negative opening for the Indian equities, with SGX Nifty futures trading 59 points, or 0.32%, lower at 18,241 on the Singapore Stock Exchange at 7:55 AM.
On Thursday, the Indian share market extended gaining momentum for the fifth straight session, ending marginal gains in the choppy trade. The weak economic data at the domestic and global front as well as F&O expiry also injected volatility in the market. The BSE Sensex closed 85 points, or 0.14%, higher at 61,235, while the NSE Nifty gained 45 points, or 0.25%, to settle at 18,257. On the sectoral front, metal and capital goods were among top performers whereas realty and bankex sectors declined the most. The top gainer on the BSE Sensex pack was Tata Steel, the country’s largest steelmaker, which ended 6.4% higher. Some of the other notable gainers include Sun Pharmaceutical Industries, Larsen & Toubro, Mahindra & Mahindra, and Power Grid Corporation of India, which gained in the range of 1.5% to 3.5%.
Stocks to focus
Individual companies that will be in focus in today’s trade include Reliance Industries, HDFC Bank, HCL Tech, Mindtree, State Bank of India (SBI), Titan Company, Hindustan Aeronautics, and Mindtree.
Reliance Industries: Shares of Mukesh Ambani-led oil to telecom conglomerate will be in focus today after the company said on Thursday that it will invest nearly ₹6 lakh crore in green energy and other projects in Gujarat. Besides, the company will also invest another ₹60,000 crore to manufacture solar PV cells and other renewable energy equipment, RIL said.
HCL Technologies: The largecap IT stock will declare its third quarter earnings on January 14. The company, one of the large players in the Indian IT Services industry, had posted a consolidated profit of ₹3,977 crore against consolidated revenues of ₹19,302 crore in the corresponding period of the previous financial year.
HDFC Bank: The private sector lender is slated to release its earnings reports for the December quarter on January 15. In the last quarter, the bank had reported a 17.6% year-on-year rise in net profit at ₹8,834.30 crore for the September quarter compared with ₹7,513.11 crore in the year-ago quarter.
State Bank of India (SBI): The country’s largest lender has raised $300 million from Regulation S Formosa bonds, securities issued in Taiwan, at a coupon rate of 2.49%.
Titan Company: The ace investor Rakesh Jhujhunwala has raised his stake in the Tata Group's company. He, along with his wife holds a 5.09% stake, or around 4.52 crore shares, in the Indian luxury products company.
Hindustan Aeronautics: Domestic rating agency ICRA has upgraded the long-term rating of state-run defence company to ‘AAA’ from ‘AA+’ and also revised the outlook to stable from positive.
Mindtree: The technology services company, which is a part of the Larsen & Toubro Group, has posted a profit of ₹437.5 crore in December 2021 quarter against ₹398.9 crore in September 2021 quarter. The revenue rose to ₹2,750 crore from ₹2,586.2 crore in the previous quarter.
Here are key things investors should know before the market opens today:
Wall Street ends lower on rate hike fears
On Wall Street, all three major U.S. indices closed lower on Thursday, snapping two sessions gaining streak, on looming fear that the Federal Reserve would be hiking interest rates this year. Investors turned jittery after the Fed Governor Lael Brainard cautioned that "inflation is too high" and that controlling inflation is the "most important task" for the central bank.
Reacting to the news, the tech-heavy NASDAQ Composite nosedived 2.5% amid renewed sell-off in growth-driven technology stocks. The blue-chip Dow Jones Industrial Average closed 0.5% lower, while the broader S&P 500 fell 1.4%.
Going forward, investors will keep an eye on corporate earnings as some big banks such as JPMorgan Chase, Citigroup Inc, and Morgan Stanley are slated to release their fourth quarter results on Friday, while major technology companies' reports will come next week.
Asian shares follow Wall Street lower
Shares in the Asia-Pacific region have fallen in morning trade on Friday, as the U.S. stocks retreated after a two-day rebound. Investors digested the U.S. government data that showed that inflation surged to its highest level in four decades last month, igniting fears that the Federal Reserve would soon raise interest rates. The economic uncertainty caused by the spread of the Omicron variant of the coronavirus also weighed on market sentiment.
Japan’s Nikkei 225 index was the worst performer in the regional market by falling nearly 2% in early trade amid rising concerns about the economic impact of the Covid-19 infections in the country, which is currently fighting the sixth wave of infections. South Korea's Kospi also dropped 1.4% in early deals.
In a similar trend, Australia’s ASX 200 index fell 1%, while the Hang Seng index in Hong Kong shed 0.74%. China’s Shanghai Composite also traded lower by 0.4%, while Taiwan Weighted Index declined 0.8%. Indonesia’s Jakarta Composite also traded lower by 0.2%.
Bucking the trend, the Straits Times Index in Singapore traded higher by 0.4% in early deals.
Companies that will announce their December quarter results today include HCL Technologies, Ashirwad Capital, Gujarat Hotels, Indokem, and Infomedia Press.
Among others, Tinplate Company of India, International Travel House, Onward Technologies, Refnol Resins & Chemicals, Space Incubatrics Technologies, Swasti Vinayaka Art And Heritage Corporation, and Swasti Vinayaka Synthetics will also release their earnings report on January 14.
FIIs turn net sellers, DIIs remain net buyers
Foreign institutional investors (FIIs) turned net sellers in the Indian equity market on January 13, while domestic institutional investors (DIIs) continued to remain net buyers. As per the data available on the NSE, FIIs net sold shares worth ₹1,390.85 crore, while DIIs net bought shares worth ₹1,065.32 crore.