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Informist, Tuesday, Jan. 28, 2025

By Akash Mandal

MUMBAI – Benchmark indices ended higher despite coming off their intraday highs. Despite the fall late in the session, headline indices still managed to recoup almost half of the sharp losses Monday. The gains were led by banks, financial services, and automobile stocks. Auto stocks gave up some of their gains in late trading, after rising more than 1% intraday and this pushed benchmark indices down. 

The Nifty 50 ended at 22957.25 points, up 128.10 points or 0.6%, and the BSE Sensex was at 75901.41 points, up 535.24 points or 0.7%. Both indices had fully recovered their losses Monday at the highs but the Nifty 50 ended 135 points away from Friday's close, while the BSE Sensex closed 289 points lower. The three Nifty mid-cap indices made a brief recovery during the session but ended down almost 1% each. All three small-cap indices also came off lows, ending down almost 2% after being down almost 4% each earlier in the session. 

Bank stocks were the biggest gainers Tuesday, powered by the Reserve Bank of India's announcement of open market operations auctions to ease liquidity in the banking system. The RBI had Monday said it would buy government bonds worth INR 600 billion in three tranches. Shares of index heavyweights ICICI Bank and HDFC Bank ended up 1.5% and 2.5%, respectively. Other financial services companies such as Bajaj Finance, Bajaj Finserv, and Shriram Finance also ended 3-4% higher. 

While banks gained Tuesday on the back of the liquidity measures announced by the RBI, the measures are not enough to fully solve the liquidity challenges faced by the banks, an analyst tracking the sector at a domestic brokerage said. The measures are expected to halve the liquidity deficit for larger private banks such as ICICI Bank, HDFC Bank, and Axis Bank, the analyst said. However, for the core problem to be solved, the central bank has to follow this up with more measures, such as a rate cut, the analyst said. 

Real estate stocks also gained, with shares of Sobha closing more than 7% higher. DLF, Godrej Properties and Macrotech Developers ended around 3% higher. Auto stocks such as Mahindra & Mahindra and Tata Motors ended up 2% and 1%, respectively. The Nifty Auto index ended up 1.3%, snapping two consecutive sessions of decline.

On the other hand, pharmaceutical and healthcare stocks were the worst hit, after US President Donald Trump said the government will stop funding the president's Emergency Plans for AIDS Relief fund. Analysts said investors feel that this decision could alter the funding for other medical programmes in the US such as Medicare and Medicaid. The Nifty Pharma index closed more than 2% lower, declining for the third consecutive session. The index has declined almost 7% in that period. Shares of Granules India, Sun Pharmaceutical Industries, and Laurus Labs ended 4-5% lower.

Among specific stocks, Cipla recovered losses and ended up nearly 2% after the company's net profit for the December quarter comfortably beat analysts' estimates. The stock was earlier down almost 1%. The company reported a consolidated net profit of INR 15.71 billion for the December quarter, against analysts' expectations of INR 12.16 billion. Its revenue for the quarter was INR 70.73 billion. 

Shares of Union Bank of India gained 5% after the bank reported a net profit of INR 46.04 billion for the December quarter, beating analysts' estimates of INR 39.38 billion. Shares of Mahindra & Mahindra Financial Services rose almost 5% ahead of its earnings later in the day. Other banks and financial services stocks such as Jammu & Kashmir Bank, Aadhar Housing Finance, and Cholamandalam Investment and Finance Co. led the gains in the Nifty 500, and were up 5-8%. 

Small-cap stocks such as Anant Raj, Apar Industries, Kaynes Technology India, and Netweb Technologies India plunged 10-20%. Shares of Petronet LNG fell over 6% after the company's net profit of INR 8.67 billion for the December quarter missed analysts' estimates of INR 9.03 billion. Shares of JSW Energy declined almost 6% ahead of its earnings, due later Tuesday. 

* Of the Nifty 50 stocks, 25 rose and 25 fell

* Of the Sensex stocks, 17 rose and 13 fell

* On the NSE, 940 stocks rose, 1,920 fell, and 77 were unchanged

* On the BSE, 1,308 stocks rose, 2,666 fell, and 110 were unchanged

* Nifty Pharma: down 2.3%; Nifty Healthcare: down 2.1%; Nifty Realty: up 2.2%

BSE                                                 NSE

75901.41 points, up 535.24 points or 0.7%           22957.25 points, up 128.10 points or 0.6%

End

Edited by Ashish Shirke

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