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Daily market commentary 13 January 2023 by Mr. Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd.

Nifty traded negative in the first half, despite positive US and India inflation data. Buying emerged in the second half taking the Nifty higher to end with gains of 92 points (0.5%) at 17952 levels. Broader markets however closed on a mixed note. Except FMCG and consumer durables, all other sectors ended in green with metals and PSU banks gaining more than 1%.

US CPI data for the month of December fell to 6.5%, which is leading to expectation of less aggressive interest rate hikes by US Fed going ahead. On the domestic front, CPI inflation further eased to 5.72% in Dec, while IIP growth improved to 7.1% in Nov’22. IT results so far came in better than estimates, thus alleviating concerns with regards to growth slowdown on account of macro headwinds. Though the sector may see some more consolidation given macro uncertainties, we believe valuations have largely corrected and offers value buying at these levels. Banking sector will be in focus next week, reacting to the HDFC Banks numbers on Saturday. Overall the global sentiments are turning positive due to decelerating inflation pressures, which along with better than expected domestic economic data and stable IT results could give support to the markets and help to move higher.

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