IGI Logo

Indian markets are likely to get a positive start on Tuesday after sell-off in the previous session, as investors to react positively to inflation data, Q3 earnings reports amid mixed cues from global peers. 

Some of the key factors to be watched:

India’s retail inflation falls to 4-month low in December, all eyes on WPI data: India’s retail inflation rate, based on the Consumer Price Index, fell to a 4-month low of 5.22 per cent in December as prices of vegetables, pulses and sugar eased during the month bringing respite to household budgets. Now, investor’s focus will be on the release of December Wholesale Price Index (WPI) data later today.

Net direct tax collections rise 15.9%: The latest figures from the income tax department showed that net direct tax collections have risen 15.9 per cent to Rs 16.9 trillion between April 1 and January 12 of FY25. The gross direct tax collections, before refunds, saw a robust 19.94 per cent growth year-on-year, rising from Rs 17.21 lakh crore in FY 2023-24 to Rs 20.64 crore this Financial Year.

Jump in crude oil prices: Traders may be concerned as oil prices continued its upward trajectory for a third consecutive session. Brent crude surpassed $80 per barrel, marking its highest level in over four months, as expanded US sanctions on Russian oil raised concerns about the potential impact on exports to major buyers like India and China. 

Stocks of renewable energy sector will be in focus: the statement by Ministry of New & Renewable Energy (MNRE) said India's renewable energy installed capacity increased by 15.84 per cent to 209.44 GW by December 2024 from 180.80 GW a year ago, marking a record expansion. The total capacity added during 2024 more than doubled to 28.64 GW from 13.05 GW added a year ago.

New listings: Quadrant Future IPO (Mainline), Capital Infra IPO (Mainline) Delta Autocorp IPO (SME), Avax Apparels IPO (SME) and BR Goyal IPO (SME) will list on the exchanges. 

On the global front, the US markets ended mostly in green on Monday as U.S. Treasury yields stayed elevated with investors dialling back expectations on the pace of rate cuts from the Federal Reserve. Asian markets are trading mixed on Tuesday after a mixed session on Wall Street that saw the Dow soar and the Nasdaq slip as investors rotated out of tech stocks.

Back home, falling for the fourth straight session, Indian equity benchmarks witnessed a sharp sell-off on Monday, ending the session in deep red, tracking heavy selling in global equities and a spike in international crude prices. Concerns over economic growth and a slowdown in quarterly earnings sapped investors’ risk appetite. The broader indices also experienced significant losses, tumbling over 4 percent each. Finally, the BSE Sensex fell 1048.90 points or 1.36% to 76,330.01, and the CNX Nifty was down by 345.55 points or 1.47% to 23,085.95.   

Some of the important factors for the markets:

Persistent foreign fund outflows: According to exchange data, foreign institutional investors (FIIs) offloaded Rs 2,254.68 crore in the capital markets on a net basis on Friday. So far this month foreign investors have withdrawn Rs 22,194 crore from Indian equities. 

Rupee at record low: Indian rupee has seen sharp depreciation since the morning and fell at its historic low of 86.62 (provisional) against the U.S. dollar, weighed down by a stronger American currency and surging crude oil prices. 

Surging crude oil prices and bond yields: The US has imposed more sanctions on Russia, triggering Brent oil higher towards $81 per barrel. Investors were cautious as U.S. Treasury yields jumped to their highest level since November 2023.

Traders overlooked IIP data & awaited CPI data: Traders ignored data showing that the India’s Index of Industrial Production (IIP) surged to a six-month high of 5.2 per cent in November 2024 from 3.7 per cent in the previous month, aided by a low base. Now, traders awaited December CPI inflation figures to be released later in the day.   

Above views are of the author and not of the website kindly read disclaimer