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Informist, Wednesday, Jan. 15, 2025

By Anshul Choudhary

MUMBAI – The benchmark indices ended marginally higher Wednesday with gains in select index heavyweights and power companies. The indices continued to face selling pressure at higher levels on concern surrounding the December quarter earnings and caution ahead of CPI data in the US, scheduled for release later in the day.

The Nifty 50 rose to 23293.65 points before coming off the high to close at 23213.20 points, up 0.2%. The BSE Sensex closed at 76724.08 points, up 0.3% higher.

Trading was largely range-bound as investors refrained from placing large bets ahead of the US inflation data, which could throw up negative surprises similar to last week's US jobs report. There is caution after the recent non-farm payrolls in December were higher than expected, leading to a sell-off in global equity markets Monday.

Investors also avoided large bets ahead of Donald Trump taking over as US president Monday. Analysts said there is uncertainty over Trump's policies and how they will affect global trade.

Gains in some heavyweight stocks helped the benchmark indices eke out slight gains. Shares of both Reliance Industries and Larsen & Toubro closed over 1% higher.

Among other large-cap stocks, Trent rose nearly 4% after falling for eight straight sessions. The stock had fallen nearly 16% in the previous eight sessions. Shares of power companies such as NTPC and Power Grid Corp. of India rose 3.5% and 2.9%, respectively. Analysts said power and energy stocks saw some buying as the valuation of many stocks in the two sectors is now "comfortable" after a significant fall over the past few months. The Nifty Energy index has gained nearly 4% in the past two sessions, but it is still down over 18% in three months.

Shares of Maruti Suzuki were up nearly 2% ahead of the launch of its first electric sports utility vehicle 'e-Vitara' at the Bharat Mobility Global Expo, which starts Friday. Earlier in the day, reports said Bank of America Securities had upgraded the stock to 'buy' with a target price of INR 14,000.

Tuesday's gains in financial stocks proved to be short-lived and these fell amid concerns around credit growth and uncertainty around interest rate cuts. Shares of Axis Bank fell 2.4%, and those of Bajaj Finance were down over 2%. Shares of public-sector banks were the worst hit, with Central Bank of India and Indian Overseas Bank down over 7% each, and UCO Bank down over 6%. The sharp fall came after Tuesday's surge of 17-18% in these stocks on reports that the government had approved a stake sale in five public-sector banks.

The broader market indices performed better than large-caps. The Nifty Midcap 150 rose 0.4% and the Nifty Smallcap 250 gained 0.5%. Within midcaps, shares of Thermax, BSE, Vodafone Idea, The Phoenix Mills, and One97 Communications were up 5-7.5%.

Shares of BSE closed over 6% higher at INR 5,786 after Nuvama Institutional Equities initiated coverage on the stock with a 'buy' rating. The brokerage has set the target price for BSE at INR 6,730. The exchange's longer term and diverse revenue streams may increase its growth potential, Nuvama said. It also said BSE is highly adaptive and is expected to grow despite tighter regulations on index derivatives.

Nuvama initiating coverage on the stock is a "short-term" trigger for the surge in stock price Wednesday, a research associate at a large broking firm said. Among other reasons for the surge in the stock price is the increase in BSE's market share and average daily turnover. The exchange's market share has increased to 18% in January from 14% in December and its average daily turnover has risen to INR 120 billion per day from INR 90 billion per day in the December quarter, the associate said.

Among major losers, Kalyan Jewellers hit its 10% lower circuit before coming off the low to end 7% down. Shares of the company fell despite attempts by the management Tuesday to allay investors' concerns about market rumours. The rumours suggested Kalyan Jewellers was buying new helicopters, and that there were audit and income tax raids on the company. The management denied these rumours on the analyst conference call Tuesday, said Soham Samanta, an analyst tracking the stock at Centrum Broking. Shares of the company have fallen sharply in the past few sessions, and are down over 30% from the lifetime high touched on Jan. 2.

* Of the Nifty 50 stocks, 26 rose and 24 fell

* Of the Sensex stocks, 18 rose and 12 fell

* On the NSE, 1,535 stocks rose, 1,252 fell, and 96 were unchanged

* On the BSE, 2,150 stocks rose, 1,806 fell, and 108 were unchanged

* Nifty PSU Bank: up 4.2%; Nifty Metal: up 4%; Nifty IT: down 2.1%

BSE                                               NSE

Sensex: 76724.08, up 224.45 points or 0.3%        Nifty 50: 23213.20, up 37.15 points or 0.2%

End

Edited by Tanima Banerjee

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