Domestic markets trim some of opening gains; trade in green in early deals

Indian equity benchmarks made positive start on Tuesday despite mixed global cues. Soon, markets trimmed some of their gains but continued their trade in green with Sensex adding 0.35%, while Nifty up 0.40% in early deals. Sentiments got boost as Chief Economic Advisor (CEA) V Anantha Nageswaran said the Indian economy is showing resilience and on the path to recovery. He added that private demand and the services sector are doing better than expected. Traders took note of report that economic grouping OECD in a report retained the GDP growth projections for India at 6.9 per cent for the current financial year despite the global economy losing momentum in wake of the Russia-Ukraine war. Though, some cautiousness came in as Finance minister Nirmala Sitharaman said ‘some people do also speak that a falling rupee also helps exports. Whether it does or doesn’t, theoretically it may, but in today’s condition, with recession outside and demand not really as adequately as it should be, even a fall in the rupee may or may not help our exports. We are conscious about these basic facts’.

On the global front, Asian markets are trading mixed following the broadly negative cues from global markets overnight, with traders remaining cautiously optimistic as they believe the heavy selling in recent sessions has been overdone. Though, the stock market in Japan, Taiwan and China are trading higher, recouping some of the losses in the previous three sessions. Back home, days ahead of unveiling the much-awaited new foreign trade policy (FTP) document, the Centre has announced extension of the existing policy by another six months due to global headwinds. In stock specific development, Jyoti Structures jumped as it secured a contract worth Rs 237 crore from Sterlite Power Transmission.

The BSE Sensex is currently trading at 57346.48, up by 201.26 points or 0.35% after trading in a range of 57311.94 and 57704.57. There were 22 stocks advancing against 7 stocks declining, while 1 stock remain unchanged on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.24%, while Small cap index was up by 0.29%.

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.97%, FMCG up by 0.89%, TECK up by 0.79%, IT up by 0.75%, Telecom up by 0.72%, while Metal down by 0.78%, Realty down by 0.60%, Auto down by 0.53%, Consumer Durables down by 0.52%, Capital Goods down by 0.47% were the top losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.45%, Hindustan Unilever up by 1.15%, ITC up by 1.13%, Sun Pharma up by 1.11% and Indusind Bank up by 1.08%. On the flip side, Titan Company down by 1.06%, Maruti Suzuki down by 1.03%, Tata Steel down by 0.95%, Kotak Mahindra Bank down by 0.55% and Larsen & Toubro down by 0.50% were the top losers.

Meanwhile, the Organisation for Economic Cooperation and Development (OECD) in its latest Interim Economic Outlook has retained the India’s Gross Domestic Product (GDP) growth projection at 6.9 per cent for the current financial year (FY23) despite the global economy losing momentum in wake of the Russia-Ukraine war. In the June 2022 Economic Outlook, the OECD projected the GDP growth for India at 6.9 per cent. It said ‘Softer external demand is a factor in India’s projected slowdown from 8.7 per cent annual growth in FY2021-22 to around 7 per cent in FY 2022-23 and around 5¾ per cent in FY 2023-24, but this still represents rapid growth in the context of a weak global economy’.

It also said the global economy has lost momentum in the wake of Russia’s war of aggression in Ukraine, which is dragging down growth and putting additional upward pressure on inflation worldwide. The outlook projects global growth at a modest 3 per cent this year before slowing further to just 2.2 per cent in 2023. This is well below the pace of economic growth projected prior to the war and represents around USD 2.8 trillion in foregone global output in 2023. It further said growth in China has also been hit and is expected to drop to a projected 3.2 per cent in 2022.

It noted that except for the 2020 pandemic, this will be the lowest growth rate in China since the 1970s. Inflation is projected to recede gradually through 2023 in most G20 countries as the tighter monetary policy takes effect and global growth slows. Headline inflation is projected to ease from 8.2 per cent this year to 6.6 per cent in 2023 in the G20 economies, and fall from 6.2 per cent this year to 4 per cent in 2023 in the G20 advanced economies. The report projects inflation for India at 6.7 per cent, at the same level as in its June 22 Economic Outlook.

The CNX Nifty is currently trading at 17084.25, up by 67.95 points or 0.40% after trading in a range of 17060.40 and 17176.45. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Cipla up by 2.46%, ONGC up by 2.07%, Britannia Industries up by 1.94%, Infosys up by 1.42% and Hindustan Unilever up by 1.37%. On the flip side, Hindalco down by 1.85%, Adani Ports & SEZ down by 1.55%, Maruti Suzuki down by 0.87%, Titan Company down by 0.86% and Hero MotoCorp down by 0.85% were the top losers.

Asian markets are trading mixed; Straits Times fell 17.15 points or 0.54% to 3,164.82, Hang Seng slipped 178.12 points or 1.00% to 17,677.02, KOSPI lost 15.56 points or 0.70% to 2,205.38 and Jakarta Composite was down by 45.04 points or 0.63% to 7,082.46. On the other hand, Nikkei 225 rose 165.80 points or 0.63% to 26,597.35, Taiwan Weighted added 16.58 points or 0.12% to 13,794.77 and Shanghai Composite was up by 7.98 points or 0.26% to 3,059.21.