Indian benchmark indices, the BSE Sensex and the NSE Nifty, are poised to open higher on Wednesday, boosted by firm global cues as Federal Reserve chairman Jerome Powell said the U.S. central bank is determined to keep inflation in check. The positive trends on SGX Nifty also indicated a gap-up opening for the Indian equities, with SGX Nifty futures trading 111 points, or 0.61%, higher at 18.202 on the Singapore Stock Exchange at 7:45 AM.
On Tuesday, the Indian share market staged a smart recovery to end higher for the third straight session. The market sentiments were lifted by strong earnings expectations with IT heavyweights TCS and Infosys, and banking major HDFC Bank, which are poised to release their third-quarter earnings report this week. The BSE Sensex ended 221.26 points, or 0.37%, higher at 60,616, while the NSE Nifty rose 52.45 points, or 0.29%, to settle at 18,055. Underperforming the benchmark indices, the broader markets ended flat with marginal gains. The S&P BSE Midcap index closed 0.01% higher, while the S&P BSE Smallcap index rose 0.15%. On the sectoral front, power, IT and realty ended higher whereas metal, FMCG and telecom settled in negative terrain. The top performers on the BSE Sensex pack were HCL Technologies, HDFC, Tech Mahindra, Tata Consultancy Services, and Reliance Industries
Stocks in news
Individual companies that will be in focus in today’s trade include Infosys, Tata Consultancy Services, Wipro, DLF, UltraTech Cement, Federal Bank, Delta Corp, PI Industries, RITES, Satluj Jal Vidyut Nigam, and others.
IT stocks: Shares of IT companies will be in focus today as index heavyweights Infosys, Tata Consultancy Services, and Wipro are slated to release their December quarter earnings reports today. This would be the first time when three major IT companies will be announcing their quarterly earnings on the same day.
DLF: The realty major notched sales worth ₹1,500 crore for towers in the first phase of the newly launched residential project, ‘ONE Midtown’, the company said in an exchange filing.
UltraTech Cement: The cement maker announced the commissioning of Line II of the Bara Grinding Unit in Uttar Pradesh. The plant has a cement capacity of 2 mtpa (million tonnes per annum). The company had already commissioned Line I in January 2020.
Federal Bank: The private lender to divest in stake in its arm, Fedbank Financial Services (FedFina), to initiate the process of an initial public offering (IPO) of its subsidiary.
Delta Corp: The casino firm on Tuesday reported robust earnings for the quarter ended December 31, 2021. The consolidated net profit jumped 55 times to ₹70.4 crore as compared to ₹1.28 crore in the corresponding quarter of the previous financial year (Q3 FY21). The revenue from operations surged 104.6% to ₹247.2 crore, from ₹120.8 crore posted last year.
PI Industries: Life Insurance Corporation of India (LIC) has acquired 72,000 equity shares in the company via open market transactions on January 10. With this, LIC’s shareholding in the company rose to 5.03% from 4.98% earlier.
RITES: The state-run railway company has inked a memorandum of understanding (MoU) with SMEC Group to cooperate and explore infrastructure projects.
Satluj Jal Vidyut Nigam (SJVN): The government-owned company has secured contracts to establish two grid-connected solar power projects of cumulative 125 MW capacity in Jalaun and Kanpur Dehat districts of Uttar Pradesh.
Here are key things investors should know before the market opens today:
Wall Street rebounds as investor cheers Powell’s testimony
On Wall Street, all three major U.S. indices ended higher in the overnight trade as investors reacted positively to comments from Federal Reserve chair Jerome Powell even though they indicate interest rates are poised to rise this year to tame inflation. The tech-heavy NASDAQ Composite was the best performer with a 1.4% gain, followed by the broader S&P 500, which rose 0.9%. The blue-chip Dow Jones Industrial Average added 0.5%.
Fed chair Jerome Powell, in a testimony before U.S. congress, said the central bank was determined to counter high inflation. He also indicated that interest rates were likely to rise soon to counter high inflation. The market is expecting the U.S. central bank's first rate hike in March, as it roll backs its bond-buying stimulus program.
Asian markets follow Wall Street higher
Shares in the Asia-Pacific region traded mostly higher in early trade, following positive cues from Wall Street. Investors cheered Fed chair Jerome Powell’s comment which eased concerns about rising U.S. inflation.
Japan’s Nikkei 225 index was the best performer in the regional market by rising 1.84% in early trade. Japan’s Nikkei was followed by the Hang Seng index in Hong Kong, which surged 1.68%. South Korea’s KOSPI also traded higher by 1.3%.
In a similar trend, Australia’s ASX 200 index climbed 0.6%, while China’s Shanghai Composite gained 0.2%. The Straits Times Index in Singapore and Indonesia’s Jakarta Composite also traded higher by 0.15% each.
Meanwhile, Taiwan Weighted Index rose 0.12% and Thailand’s SET Composite surged 0.6% in early deals.
Corporate earnings
Some of the companies that will announce their December quarter results today include IT heavyweights Infosys, Tata Consultancy Services, and Wipro.
Among others, Indbank Merchant Banking Services, Ind Bank Housing, KD Leisures, Kome-On Communication, NB Footwear, Pradhin, Roselabs Finance, Tinna Rubber and Infrastructure, and Virinchi, will also release their earnings reports.
World Bank pegs India's GDP growth at 8.3% for FY22
The World Bank expects Indian economy to grow at 8.3% in the current fiscal and at 8.7% in financial year 2022-23, lower than the Indian government's first advance estimate. As per the first advance estimate released by the Indian government on January 8,, the country’s GDP is likely to grow by 9.2% in FY22.
According to the World Bank’s Global Economic Prospects report, the global economic growth will "decelerate markedly" this year to 4.1% from an estimated 5.5% in 2021. The report, however, warned that the Omicron-related economic disruptions could substantially reduce growth to as low as 3.4%.
Crude oil prices rise ahead of inventory data
Crude oil futures traded higher during early Asian trading hours on Wednesday ahead of the much-awaited American Petroleum Institute’s (API) inventory data report. Adding to it, rising optimism that fast-spreading Covid-19 cases would have less impact on the global demand recovery also boosted sentiment.
The U.S. West Texas Intermediate (WTI) Crude oil futures for February were up 0.34% at $81.51 a barrel, while the Brent oil futures for March traded 0.26% higher at $83.85 per barrel.
In the overnight trade, global benchmark Brent crude and the U.S. WTI crude climbed up to 4%. Brent crude surged 3.2% to $83.46 a barrel, while the U.S. West Texas Intermediate (WTI) crude rallied 4% to $81.59 per barrel.
FIIs, DIIs turn net buyers
Foreign institutional investors (FIIs) and domestic institutional investors (DIIs) turned net buyers in the Indian equity market on January 11. As per the data available on the NSE, FIIs net purchased shares worth ₹111.91 crore, while DIIs net bought shares worth ₹378.74 crore.
