Indian benchmark indices, the BSE Sensex and the NSE Nifty, are likely to extend their losing streak on Thursday, following weak cues from global peers. The negative trends on SGX Nifty also indicated a bearish opening for the Indian equities, with SGX Nifty futures trading 73 points, or 0.41%, lower at 17.904 on the Singapore Stock Exchange at 8:10 AM.
On Wednesday, Indian benchmark indices extended fall for the second straight session as record rise in oil prices and sustained selling by foreign investors weighed on market sentiments. The BSE Sensex closed 656 points, or 1.08%, lower at 60,098, and the NSE Nifty tumbled 174 points, or 0.96%, to settle at 17,938. The broader markets ended on a mixed note, with the S&P BSE Midcap index falling 0.34%, and the S&P BSE Smallcap index rising 0.03%. The sectoral indices ended on a mixed note, with PSU, power, auto, metal, and oil & gas indices ending higher, while IT, tech, bank, FMCG, pharma, and realty settled in negative terrain. Among individual stocks, Infosys, Asian Paints, Nestle India, Hindustan Unilever Ltd., and Bajaj Finance were among the top five losers.
Stocks to focus
State Bank of India (SBI): The union cabinet on Wednesday approved ₹973.74 crore to the public sector lender as reimbursement related to the loan moratorium that was implemented in 2020 in wake of the Covid-19 pandemic.
Aviation stocks: Shares of Aviation companies such as IndiGo and Spicejet will be in focus after the rating agency ICRA revised downward its estimates for recovery in the domestic aviation market to 52% of pre-pandemic levels from 62% earlier. The recovery estimate was cut in light of the fresh outbreak of the third wave of COVID-19 in the country.
Bajaj Auto: The auto major posted a 22% year-on-year drop in net profit at ₹1,214 crore for the third quarter ended December 31, 2021 due to lower sales. The revenue from operations rose 1.25% YoY to ₹9,022 crore from ₹8,910 crore in the same quarter a year ago.
HCL Technologies: The IT company has appointed Accenture former executive Prabhakar Appana as senior vice-president and global head of its AWS Ecosystem business unit.
JSW Energy: The energy major posted more than a two-fold jump in its consolidated net profit on a year-on-year basis to ₹324 crore for the December 2021 quarter, mainly on the back of higher revenues.
Tata Communications: The Tata group company reported a 27.8% rise in consolidated net profit at ₹395.21 crore for the third quarter ended December 2021, compared to ₹309.41 crore in the same period a year ago.
HUL: The FMCG major is slated to release its December quarter earnings report today. The company is expected to report double-digit growth in net profit, while sales growth has been pegged at around 8-10% on the back of price hikes.
Here are key things investors should know before the market opens today:
Wall Street extends fall on rate hike concerns
In the overnight trade, all the three major U.S. indices closed sharply lower on Wednesday as investors continued to worry about rising U.S. Treasury yields and the Federal Reserve tightening monetary policy. Investors awaited next week's Fed policy meeting for more clarity on the central bank's plan to tame inflation.
Continuing its losing streak, the Dow Jones Industrial Average ended 1% lower, the S&P 500 fell 1%, and the NASDAQ Composite dropped 1.2%.
Asian stocks mostly higher despite rising bond yields
Shares in Asia-Pacific region traded mostly higher in early deals on Thursday, undermining overnight sell-off on Wall Street, as investors seemed to shrug off concerns about rising bond yields and record U.K. inflation levels.
Japan’s Nikkei 225 index rose 0.4% after falling sharply over 2% in the previous session. South Korea’s KOSPI also gained 0.12% in early deals.
China mainland shares also edged higher, with the Shenzhen component and the Shanghai composite rising 0.07% and 0.15%, respectively.
The Hang Seng index in Hong Kong was the best performer in the regional market with a 1.8% gain. Indonesia’s Jakarta Composite also traded marginally higher.
Meanwhile, the Straits Times Index in Singapore and Australia’s ASX 200 index edged lower, while Taiwan Weighted Index dropped 0.27%. Thailand’s SET Composite also fell 0.12% in early trade.
Corporate earnings
The big companies that will announce their December quarter results today include Asian Paints, Biocon, Bajaj Finserv, HUL, PNB Housing Finance, Havells India, and many more.
Among others, Agro Tech Foods, Bajaj Holdings & Investment, Century Textiles & Industries, Container Corporation Of India, Cyient, Datamatics Global Services, Hatsun Agro Product, Lyka Labs, Bank Of Maharashtra, Mphasis, Persistent Systems, Reliance Industrial Infrastructure, Sasken Technologies, Shoppers Stop, South Indian Bank, Vimta Labs and VST Industries will also release their earnings report on January 20.
FIIs, DIIs remain net sellers
Foreign institutional investors (FIIs) and domestic institutional investors (DIIs) continued to remain net sellers in the Indian equity market on January 19. As per the data available on the NSE, FIIs net sold shares worth ₹ 2,704.8 crore, while DIIs net bought shares worth ₹195 crore.
Crude oil prices retreat from record high
Crude oil prices were trading lower during early Asian trading hours on Thursday, after hitting a fresh seven-year high in the previous session amid fear of escalating global political tensions in the Middle East.
The U.S. WTI Crude oil futures for March were down 0.3% at $85.61 a barrel, while the Brent oil futures for March traded 0.6% higher at $88.18 per barrel.
In the overnight trade, crude oil surged for a fourth day after a fire on a pipeline from Iraq to Turkey briefly stopped production. The market sentiment was also boosted after an International Energy Agency said global oil demand is likely to hit pre-pandemic levels.
