Markets surrender early gains; Nifty ends below 17,500; HDFC twins drag

The domestic equity benchmarks reversed early gains and ended with small losses on Wednesday. Persistent high inflation, rising bond yields and tightening monetary policy globally weighed on investors` sentiment. The Nifty settled below the 17,500 mark after hitting the day`s high of 17,663.65 in early trade. Trading was volatile due to expiry of weekly index options on the NSE.

The S&P BSE Sensex declined 237.44 points or 0.41% to 58,338.93. The Nifty 50 index slipped 54.65 points or 0.31% to 17,475.65.

HDFC (down 2.01%), HDFC Bank (down 1.90%), Maruti Suzuki India (down 1.86%), Dr Reddy`s Laboratories (down 1.71%) and Asian Paints (down 1.62%) were major drags.

In the broader market, the BSE Mid-Cap index fell 0.21% and the BSE Small-Cap index gained 0.27%.

The market breadth was positive. On the BSE, 1815 shares advanced, 1589 were declined and 125 were unchanged.

The market will be shut on account of Mahavir Jayanti and Ambedkar Jayanti on April 14 and Good Friday on April 15.

Economy:

India`s retail inflation jumped to a 17-month high of 6.95% in March from 6.07% in February, according to data released on 12 April 2022 by the Ministry of Statistics and Programme Implementation.

Consequently, the yield on India`s 10-year benchmark paper rose to 7.216% compared with 7.189% at close in the previous trading session.

The country`s factory output (IIP) rose 1.7% in February 2022 compared to a revised estimate of 1.5% in January this year, the data published by the Ministry of Statistics and Programme Implementation (MoSPI) on Tuesday showed.

India`s merchandise trade deficit for March 2022 touched $18.51 billion as against $13.64 billion in March 2021 and $9.98 billion in March 2020, data released by the government showed on Wednesday (13 April).

Merchandise exports in March 2022 were $42.22 billion, as against $35.26 billion in March 2021, exhibiting a positive growth of 19.76%. Merchandise imports in March 2022 were $60.74 billion, an increase of 24.21% over imports of $48.90 billion in March 2021.

Numbers to Watch:

In the foreign exchange market, the rupee was lower against the dollar. The partially convertible rupee was hovering at 76.17, compared with its close of 76.15 during the previous trading session.

MCX Gold futures for 3 June 2022 settlement rose 0.42% to Rs 53,102.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, rose 0.13% to 100.42.

In the commodities market, Brent crude for June 2022 settlement rose $1.91 at $106.55 a barrel. The contract rose $6.16 or 6.26% to settle at $104.64 a barrel during the previous trading session.

Foreign Markets:

European markets fell across the board while Asian stocks ended higher on Wednesday.

U.S. consumer prices (CPI) inflation rose 8.5% in March as compared with a year ago, the fastest annual gain since December 1981, according to official data released Tuesday. The core consumer price index which excludes food and energy, however, showed signs it may be ebbing. It rose 0.3% for the month.

The Reserve Bank of New Zealand on Wednesday announced its decision to raise the official cash rate by 50 basis points to 1.5%.

Stocks in Spotlight:

Infosys rose 0.41%. The IT firm`s consolidated net profit fell 2.1% to Rs 5,686 crore on a 1.3% increase in revenues to Rs 32,276 crore in Q4 FY22 over Q3 FY22. On a year-on-year basis, Infosys` net profit and revenue in Q4 FY22 increased 12% and 22.7%, respectively.

Revenues in constant currency terms grew by 20.6% YoY and 1.2% QoQ. Operating margin for the quarter stood at 21.5%, a decline of 3% YoY and 2% QoQ.

Infosys said growth was broad-based, supported by continued momentum in large deal wins with total contract value (TCV) of large deal wins was $2.3 billion in Q4 FY22.

The company issued strong revenue growth guidance of 13%-15% in constant currency and operating margin guidance of 21%-23% for FY23.

Arman Financial Services jumped 6.57% after the company said it delivered solid post-pandemic performance aided by improved asset quality.

The Gujarat based non-banking finance company (NBFC) said that its consolidated Asset Under Management (AUM) as on 31 March 2022 stood at about Rs 1,222 crore, higher by 50% year-on-year (YoY) and 17% quarter-on-quarter (QoQ).

Consolidated disbursements for Q4 FY22 stood at Rs 339 crore and for FY22 at Rs 1,049 crore, higher by 23% and 106% YoY respectively. Consolidated collection efficiency for March 2022 stood at 97.8%, steadily moving towards Pre-COVID levels.

Mrs Bectors Food Specialities slumped 9.16% to Rs 306.35, following large block deals in the counter in initial deals.

New Listing:

Shares of Hariom Pipe Industries hit an upper circuit of 5% at Rs 224.70 on the BSE, a premium of 46.86% compared with the issue price of Rs 153.

The scrip was listed at Rs 214, a premium of 39.87% to the initial public offer (IPO) price.

The scrip hit an intraday low of Rs 214 in early trade. Over 3.73 lakh shares of the company have changed hands in the counter.

The IPO of Hariom Pipe Industries was subscribed 7.93 times. The issue opened for bidding on 30 March 2022 and it closed on 5 April 2022. The price band of the IPO was fixed at Rs 144 - Rs 153 per share.

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