Markets trade nervously; Sensex near 61k, Nifty 50 holds 18,210; Bank, IT underperform; Axis Bank, HCL Tech, HDFC, HUL, Wipro drag

14 Jan 2022 , 09:50 AM

Investors traded nervously in the global markets weighing on Indian benchmarks as well on Friday. The cautious betting was followed by a rapid resurgence in active Covid cases due to Omicron spread, US Federal Reserve’s hawkish remarks and inflationary pressure. Corporate earnings season limits the downside on equities. Benchmark struggles to hold 61,000-mark, while Nifty 50 floats slightly above 18,200-mark.

A broad-based selloff was recorded across sectoral indices with IT and banking stocks being the worst. However, capital goods and auto stocks outperformed the markets and counterparts.

At around 09.43 AM, Sensex was trading at 61,071.09 down by 164.21 points or 0.27%. The benchmark has erased the 61,000-mark in the opening bell and even clocked the day’s low of 60,757.03.

Nifty 50 traded at 18,216.65 lower by 41.15 points or 0.23%. The index has touched an intraday low of 18,119.65.

In terms of sectoral indices, on BSE, the IT and Bankex index dipped over 190 points and 180 points respectively. On the contrary, the Capital Goods index soared over 250 points.

Top bulls on Sensex were – Reliance Industries, L&T, Maruti Suzuki, Power Grid, NTPC, HDFC Bank and Ultratech Cement.

Top bears on Sensex were – Axis Bank, HCL Tech, Asian Paint, HDFC, Wipro and Hindustan Unilever slipping between 1-2.5%.

IT stocks are in focus ahead of HCL Tech Q3 earnings today after Mindtree beats street expectations in its quarterly performance.

Other companies that will announce their Q3 today are –  Tinplate Company of India, Ashirwad Capital, Gujarat Hotels, Indokem, Infomedia Press, International Travel House, Onward Technologies, Refnol Resins & Chemicals, Space Incubatrics Technologies, Swasti Vinayaka Art And Heritage Corporation, and Swasti Vinayaka Synthetics.

The Indian government will announce the country’s WPI’s inflation for December 2021, later today.

On the global front, Asian stocks nosedived with Japan’s Nikkei 225 shedding nearly 2%, while South Korea’s KOSPI index diving 1.5%. Hong Kong’s Hang Seng and Australia’s S&P/ASX dropped over 1% each. China’s Shanghai Composite also took a beating.

Investors reacted to a stream of hawkish remarks made by the US Federal Reserves after the country’s inflation reached four decades low. To put an end to ultra-easy monetary conditions, the Fed has signalled to hike interest rates sooner-than-expected most likely in March. The dollar index against a basket of currencies has hit a 2-months low.

Overnight, on Wall Street, US stocks logged another day of weakness as Nasdaq sees big sell-off falling over 2.5% which drags most indices into the red. Dow Jones closes lower by 176 after being up over 224 in the intraday trade. Bond yields close near 1.72% while the US$ index weakens further to 94.80. Nasdaq to see fifth straight weekly losses as money exists technology stocks on rising yields.