Markets snap 4-day rally to end flat; IT stocks outperform

14 Jan 2022 , 03:41 PM

Domestic equities snapped four days’ rally to close almost flat on the back of weak global cues with the Nifty 50 down marginally by 0.1%. The broader market outperformed the main indices, Nifty Midcap 50 dipped 0.03%, while Nifty Smallcap 50 index was up 0.45%. The market recovered in the last hour of the trading session and Sensex closed down marginally by 12.27 points or 0.02% at 61,223.03, and the Nifty was down 2 points or 0.01% at 18,255.80

Most sectoral indices saw a crunch except Nifty Realty, Nifty PSU Bank, Nifty Metal and Nifty IT. Nifty Realty gained the most at 1.35%, followed by Nifty IT at 0.61%.

Tata Consumers, TCS, Infosys, Larsen & Toubro, IOC, HDFC Bank, Tech Mahindra, Ultratech cement, Kotak Bank, HCL Tech, NTPC and Bajaj Finance gained in a sluggish day.  

Asian Paints, Axis Bank, Hindustan Unilever, ONGC, UPL, Mahindra and Mahindra, HDFC Limited and Wipro were the top laggards.  

On the economy front, the WPI inflation printed in double digits for the ninth consecutive month, easing only modestly in December 2021 from November’s high, with a jump in primary food and non-food inflation absorbing a part of the correction in other items.

The primary food inflation has spiked from the marginal 0.1% in October 2021 to an unpleasant 23-month high of 9.6% in December 2021, reflecting the unfavourable base, particularly for vegetables.

Unfavourable base effect pushed India’s consumer price index (CPI) or retail inflation to a five-month high at 5.59% in December 2021 compared to 4.91% in the previous month. Last year, in December, CPI stood at 4.59%. A sharp rise in food inflation and unyielding inflation in the segments like fuel and miscellaneous components – led to an uptick in the CPI.

Further, India’s Industrial Production (IIP) growth pulled back to 1.4% in November 2021 compared to 4% growth in the previous month. The quick estimates of the index stood at 128.5. The factory output is at nine months low in November this year.