US inflation is at all time high! How will the Indian market react?

Good Morning Everyone, Yesterday, Nifty opened with a gap up yesterday and went on for another day of rising to close at 18212. But one important point to note was that the FIIs again sold for more than Rs. 1000 crores yesterday.


US inflation data is out and is above 7% which is the highest inflation since 1982. However, the US market continued to rise and closed higher yesterday with the feeling that the worst is over.


India's IIP data also showed a decline which is not great news.


With the weekly expiry today, we are expecting huge volatility in the market today.


The Nifty is set for a gap-up opening but 17350 will still act as a resistance and we might see some sell-off in the market today. Looks like the Nifty will trade between 18350 and 18100 today.



On the daily time frame, Nifty continues to make indecisive candles with a positive bias.


The Small-cap index was up 0.65% led by GRAPHITE up 7.66%, CHAMBLFERT up 6.6%, HEG up 4.57%. Top losers were ALOKINDS down 3%, JBCHEPHARM down 2.26%, JUBLINGREA down 1.82%.

The Mid-cap index was up 1.2% led by IDEA up 8.9%, M&MFIN up 5.57% & SRF up 3.44%. The top losers were MFSL down 1.49%, BHARATFORG down 1.4%, TORNTPOWER down 1.02%.

The Nifty50 index was up 0.87% led by M&M up 4.53%, BHARTIARTL up 3.65%, INDUSIND up 2.78%. The top losers were Titan down 1.6%, TCS down 1.5% & SHREECEM down 1.07%.

Global Market:

U.S. stock indexes rose on Wednesday after data showed that while U.S. inflation was at its highest in decades, it largely met economists' expectations, cooling some fears that the Federal Reserve would have to pull back support even more forcibly than already expected.

The Dow Jones Industrial Average rose 38.3 points, or 0.11%, to 36,290.32, the S&P 500 gained 13.28 points, or 0.28%, to 4,726.35 and the Nasdaq Composite added 34.94 points, or 0.23%, to 15,188.39.



Indian Market:

India's headline retail inflation jumped to 5.59 percent in December 2021, thanks to an unfavorable base effect. The latest Consumer Price Index (CPI) inflation print is 68 basis points higher than the November 2021 level of 4.91 percent, data released on January 12 by the National Statistical Office showed. It is the highest inflation has been since July 2021, when it had also come in at 5.59 percent.


Despite the sharp increase in inflation in December 2021, the average for the last quarter of 2021, at 5.0 percent, is marginally lower than expected. The Reserve Bank of India had forecast CPI inflation would average 5.1 percent in October-December 2021.


Union telecom minister Ashwini Vaishnaw on Wednesday said the present and future debt liabilities will continue to remain with the telecom companies that have proposed to convert their interest liabilities payment into equity.


Debt-ridden Vodafone Idea Ltd (VIL), Tata Teleservices Ltd (TTSL) and Tata Teleservices (Maharashtra) Ltd (TTML) have proposed to convert their respective interest liability payable on dues to the government into equity. Post conversion, the government will have stakes in the three companies.

"Government will remain an investor only. The companies will be run by the professionals. All the debt liabilities will remain the responsibility of the companies. The companies have given us commitment," Vaishnaw said.


Industry chamber Ficci on Wednesday suggested the government to provide an interest subsidy of 3-4 percent on housing loans and extend the concessional tax rate of 15 percent to companies that invest in green technologies, in the forthcoming Budget. Housing and construction sectors have forward and backward linkages and impact nearly 200 sectors and it needs to be provided holistic support in the upcoming Union Budget, it said.


"An interest subsidy of 3-4 percent on housing loans could also be offered for a period of 3-4 years. "Extend a concessional tax rate of 15 percent to companies that invest in green technologies on or after a specified date and also allow full deduction towards investment/ purchase of green technology assets," it added.


Tata Consultancy Services reported a higher profit at Rs 9,769 crore in Q3FY22 against Rs 9,624 crore in Q2FY22, revenue jumped to Rs 48,885 crore from Rs 46,867 crore QoQ. It also approved a buyback of 4 crore equity shares for up to Rs 18,000 crore, at a price of Rs 4,500 per share. On the other hand, Infosys reported a higher profit at Rs 5,809 crore in Q3FY22 against Rs 5,421 crore in Q2FY22, revenue rose to Rs 31,867 crore from Rs 29,602 crore QoQ. Wipro reported higher revenue at $2,639.7 million in Q3FY22 against $2,580 million in Q2FY22 and expects constant currency revenue growth at 2-4% for Q4FY22.


FII and DII data

Foreign institutional investors (FIIs) net sold shares worth Rs 1,001.57 crore, while domestic institutional investors (DIIs) net purchased shares worth Rs 1,332.01 crore in the Indian equity market on January 12


Results Today

Mindtree, Tata Metaliks, Aditya Birla Money, CESC, Eureka Industries and GTPL Hathway | These companies will report their quarterly earnings today.


Stock Specific News:

Tata Consultancy Services | The company reported a higher profit at Rs 9,769 crore in Q3FY22 against Rs 9,624 crore in Q2FY22, while revenue jumped to Rs 48,885 crore from Rs 46,867 crore QoQ. It also approved a buyback of 4 crore equity shares for up to Rs 18,000 crore, at a price of Rs 4,500 per share.


Infosys | The company reported a higher profit at Rs 5,809 crore in Q3FY22 against Rs 5,421 crore in Q2FY22, and revenue rose to Rs 31,867 crore from Rs 29,602 crore QoQ. Infosys has raised its FY22 revenue growth guidance raised to 19.5-20 percent from 16.5-17.5 percent.


Wipro | The company reported higher revenue at $2,639.7 million in Q3FY22 against $2,580 million in Q2FY22 and expects constant currency revenue growth at 2-4 percent for Q4FY22. Wipro guided for revenue growth at 2-4 percent in constant currency terms for Q4 which is in line with a CNBC-TV18 poll.


Tata Motors | JLR retail sales dropped nearly 38 percent YoY to 80,126 units in October-December 2021, with China sales falling 7 percent and Europe sales down 7 percent QoQ.


Kotak Mahindra Bank | The bank passed a resolution to cap promoters' voting rights at 26 percent.


Lumax Industries | The company has commenced its commercial production, of electronic components for automotive, at its new manufacturing plant situated at Bawal, Haryana.


PB Fintech | Paisabazaar has reached an annualised loan disbursal rate of $1.1 billion (excluding credit card issuance). In December 2021, the fintech disbursed around Rs 695 crore of loans, which included unsecured loans like personal and business loans and secured loans like home loans and loans against property.


Manappuram Finance | The company will meet on January 17 to consider raising funds via NCDs.


NALCO | The company said it has successfully put into operation all the 960 pots at its existing smelter plant located in Angul, Odisha.








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