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Indian markets ended a volatile session marginally in green on Friday amid lack of directional cues and dashed hopes of an early rate cut by the Reserve Bank of India. Today, markets are likely to open in green tracking positive cues from Wall Street. Traders will be eyeing major macroeconomic data starting with Consumer Price Index (CPI) for January and India Industrial Production (IIP) for December to be out later in the day, for more directional cues. Easing crude oil prices likely to support domestic markets. Oil prices fell in early Asian trade after Israel said it had concluded a series of strikes in southern Gaza, slightly easing concerns about supply from the Middle East. Foreign fund inflows likely to aid sentiments. Provisional data from the NSE showed that foreign institutional investors (FIIs) net bought shares worth Rs 141.95 crore on February 9. Sentiments will get a boost as the finance ministry data showed that direct tax collections grew 20.25 per cent till February 10 of the current financial year (FY24), which is more than the 17.24 per cent pegged in the revised estimates (RE) for the entire year. At Rs 15.60 trillion, the direct tax receipts till Saturday constituted 80.23 per cent of Rs 19.45 trillion projected in the RE for FY24. However, muted trading elsewhere in Asia on account of Lunar New Year holidays, likely to cap upside. Traders may take note of Piyush Goyal’s statement that India may not get the same amount of foreign direct investment (FDI) in the current financial year as compared to FY23, but I don’t see it as a material factor. There will be some buzz in fertilizer industry stocks as a private data showed that India’s urea production increased by over 12 per cent in the first nine months of the current financial year (FY24), while imports were marginally less than last year and sales remained flat. Urea is the largest consumed fertilizer in India followed by DAP. Sugar industry stocks will be in focus with report that the centre has released about Rs 15,948 crore under different schemes in the last five years till January 31 to various sugar mills to improve their liquidity for clearing cane price dues of farmers. There will be some reaction in hotel industry stocks with a private report that the hotel industry continued to experience year-on-year growth in performance in the October-December period of 2023, driven primarily by a 14.6 per cent increase in Average Daily Rate ADR compared to the year-ago period, which led to a RevPAR growth of 15.8 per cent. Meanwhile, investors will also react to Q3 earnings of ONGC, Mamaearth and Hero Moto, among others.  

The US markets ended mostly in green on Friday with boosts from megacaps and chip stocks, including Nvidia as investors bet on artificial intelligence technology and eyed strong earnings data. Asian markets are mostly closed Monday including Hong Kong, Taiwan and South Korea, while Jakarta is trading in green. China remains shut for the week.

Back home, in a volatile session, Indian equity markets managed to end in green on Friday aided by a rebound in banking stocks after yesterday’s sell-off. Markets made a cautious start and remained sideways during the trading session, amid lackluster cues from global peers. Traders were cautious with provisional data from the NSE showing that foreign institutional investors (FIIs) net sold shares worth Rs 4,933.78 crore on February 8. Some concern also came as crude oil prices gained on concerns of a broadening conflict in the Middle East after Israel rejected a ceasefire offer from Hamas. However, headline indices recovered from early cuts in afternoon deals and managed to post mild gains as traders took support with the Reserve Bank of India’s (RBI) latest ‘Industrial outlook survey of the manufacturing sector for Q3:2023-24’ stating that manufacturing companies reported positive demand conditions during Q3:2023-24 as reflected in their assessment of production, capacity utilisation, pending orders, employment and overall business situation but they were less sanguine when compared to the previous survey round. Some optimism also came with Rural Development Minister Giriraj Singh’s statement that digitisation of land records and registration is expected to improve the GDP of the country by about 1.5 per cent. Traders took a note of report that ministries of finance, shipping as well as commerce and industry have discussed problems being faced by exporters due to the Red Sea crisis and the commerce ministry has suggested sharing specific matters for their resolution. There is no adverse impact on the country’s exports due the crisis so far. Finally, the BSE Sensex rose 167.06 points or 0.23% to 71,595.49 and the CNX Nifty was up by 64.55 points or 0.30% to 21,782.50.

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