The Indian equity benchmarks closed flat after a highly volatile session on January 11, as investors turned cautious a day ahead of the release of domestic and US inflation data for cues on central banks’ rate hike trajectory.
The Sensex closed 9.98 points, or 0.02 percent, lower to 60,105.50 and the Nifty dropped 18.50 points, or 0.10 percent, to close at 17,895.70.
Despite positive global cues, the market opened negative but recovered only to swing between gains and losses throughout the session.
“After a volatile session, the domestic market anchored near the flat line as investors remained cautious ahead of the release of inflation data, though positive sentiments from global counterparts attempted multiple recoveries in between,” said Vinod Nair, Head of Research at Geojit Financial Services.
“India’s CPI for December is projected to remain unchanged, while the US CPI is estimated to further cool down from November’s level of 7.1 percent.”
Relentless selling by foreign institutional investors as a result of the premium valuation of the domestic market, too, is weighing on the domestic market, Nair said.
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Stocks and sectors
Hindalco Industries, Sun Pharma, BPCL, UltraTech Cement and HDFC Bank were among the top gainers on the Nifty, while losers included Bharti Airtel, Cipla, Divis Labs, Apollo Hospitals and HUL.
On the sectoral front, the Nifty FMCG index fell 1 percent, while auto, pharma, energy and infra were down 0.5 percent each. Nifty Bank, metal, information technology and PSU Bank indices added 0.3-0.7 percent.
Broader indices performed in line with the benchmarks, with both BSE midcap and smallcap indices closing flat.
On the BSE, auto, FMCG, healthcare, power and oil & gas indices shed 0.2-1 percent. Bank, capital goods, metal and information technology indices gained 0.3-0.8 percent.
More than 100 stocks touched their 52-week high on the BSE. These included SAL Steel, JSPL, CG Power, Marksans Pharma and Modern Dairies.
On the other hand, Biocon, Gland Pharma, Glaxosmithkline Pharmaceuticals, Vodafone Idea, Laurus Labs, MT Educare, Omaxe, Rolta and Sintex Industries sank to their 52-week low.
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Among individual stocks, a volume spike of more than 100 percent was seen in NMDC, Laurus Lab and Indian Oil Corporation.
A short build-up was seen in Bharti Airtel, Laurus Lab and SRF, while a long build-up was seen in Tata Communications, NMDC and Indian Oil Corporation.
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Outlook for January 12
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
While the markets moved in a narrow range, select bouts of intraday volatility kept investors at bay. The US Federal Reserve chairman’s speech, too, didn’t signal any moderation in their rate hike approach, which has been hurting investors.
The market is witnessing non-directional activity and, perhaps, traders are waiting for either side breakout.
For bulls, 18,000 will be the important breakout level to watch out for and above it, we can expect a quick uptrend rally towards 18,100-18,150. On the flip side, a slip below 17,800 can trigger further weakness to 17,700-17,675.
Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by BNP Paribas
The Nifty has been witnessing sharp swings in both directions, which is a part of the short-term consolidation process. In terms of the price patterns, the oscillations in the last few sessions have resulted in a triangular pattern formation.
The Nifty got support on the downside as it approached the lower end of the pattern. On the downside, 17,800 will be the key support. Unless that breaks on a closing basis, the index is expected to recover once again.
On the higher side, the immediate hurdle is at 18,000, beyond which the Nifty can test 18,100-18,150 in the short term.
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