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Indian markets ended a choppy session slightly higher on Tuesday amid optimism over the earnings seasons. Today, benchmarks are likely to start higher, extending gains for the fourth straight session, amid strong cues from their global peers. Investors will be eyeing the industrial growth and retail inflation data to be out later in the day. Sentiments will get a boost as the World Bank retained its FY22 growth forecast for India at 8.3 per cent but upgraded it to 8.7 per cent for FY23, from 7.5 per cent estimated earlier, citing improving growth prospects, especially a reviving private capex cycle. Traders will be taking encouraged as preliminary data from the commerce ministry showed that the country's exports grew 33.16 per cent to $7.63 billion during January 1-7 period on account of healthy performance by various sectors, including engineering, petroleum and gems and jewellery. Some support will come as former chief economic adviser Arvind Virmani said the Indian economy is likely to register a growth of 9.5 per cent in this financial year. Virmani said that government expenditure and exports have peaked, but so far private consumption has not recovered due to the COVID-19 pandemic. also, RAI said retail sales in December last year grew by 7 per cent over the pre-pandemic levels of the same period in 2019 but the pace dropped towards the last week of the month under review due to the third COVID wave. There will be some buzz in the road sector stocks as rating agency Icra said that high Wholesale Price Index (WPI) inflation is a blessing in disguise for toll road projects as toll collections are set to witness 14-15 per cent growth in 2022-23. IT stocks will be in focus ahead of their quarterly earnings to be announced after market hours. Telecom stocks too will be in limelight with the three leading telcos seeking 90-95 per cent reduction in base price of 5G spectrum auction. There will be some reaction in edible oil industry stocks as the Centre said retail prices of edible oils across the country are ruling higher than a year-ago period in line with the global market but from October 2021 onwards, there is a declining trend.

The US markets ended higher on Tuesday after Powell's comments likely reassured investors that the Fed was not going to prioritize inflation reduction above everything else, including employment. Asian markets are trading in green on Wednesday following overnight gains on Wall Street.

Back home, Indian equity benchmarks ended higher for the third day in a row in a choppy session on Tuesday led by gains in Power, Utilities and IT stocks. Key gauges were volatile in early morning trade after opening on a slightly positive note, as traders were concerned with a private report stating that sluggish growth momentum in the December quarter and emerging risk from the third Covid-19 wave may shave 80 basis points (bps) off India’s real gross domestic product (GDP) growth to 9 per cent for FY22. Some cautiousness came in as data from the Reserve Bank of India (RBI) showed outward foreign direct investment by Indian companies fell by over 8 per cent to $2.05 billion in December 2021 in the current fiscal. Adding to the pessimism, a domestic rating agency said lockdowns to contain the spread of the third COVID wave hurt loan collections and new lending by non-banks, and will in turn impact securitisation volumes. Rising coronavirus cases also dampened sentiments in the markets. However, key indices inched up as they recovered from some early morning volatility, taking support from the Quarterly Employment Survey (QES) report released by Union Labour Minister Bhupender Yadav stating that total employment in nine select sectors stood at 3.10 crore in the July-September 2021 quarter (Q2FY22), which is 2 lakh more than that of the April-June period. He said the rise shows improvement in economic activities after lifting of lockdown restrictions by states to curb the spread of deadly virus after the second wave of the COVID-19 pandemic hit the country in April 2021. Traders got support after Tata group’s Chairman N Chandrasekaran said that coronavirus pandemic has not impacted India’s long-term growth trajectory although it has delayed it and in this decade, the country will lead the global growth rates. Finally, the BSE Sensex rose 221.26 points or 0.37% to 60,616.89 and the CNX Nifty was up by 52.45 points or 0.29% to 18,055.75.

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