Benchmarks retreat: IT, banking drag Nifty below 23,210

The key domestic equity indices ended with modest losses on Friday, snapping a three-day winning streak. The Nifty index closed below the 23,210 mark, weighed down by weakness in the IT and banking shares.

Concerns over rising crude oil prices and a depreciating rupee added to investor worries. Persistent selling by foreign institutional investors further exacerbated the downward pressure.

Investor anxiety surrounding the upcoming US Presidential inauguration and the potential impact of policy shifts on global markets created a sense of uncertainty. The strengthening of the US Dollar and rising bond yields in the US also made emerging markets like India less attractive for investment.

In the barometer index, the S&P BSE Sensex tumbled 423.49 points, or 0.55% to 76,619.33. The Nifty 50 index lost 108.60 points or 0.47% to 23,203.20. In three consecutive trading sessions, the Sensex and Nifty rose by 0.38% and 0.51%, respectively.

Infosys (up 5.77%), Axis Bank (up 4.71%), TCS (up 1.96%), ICICI Bank (up 1.91%) and HDFC Bank (up 0.97%) were major drags.

In the broader market, the S&P BSE Mid-Cap index rose 0.04% and the S&P BSE Small-Cap index added 0.01%.

The market breadth was positive. On the BSE, 2,056 shares rose and 1,886 shares fell. A total of 123 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, added 1.81% to 15.75.

Numbers to Track:

The yield on India's 10-year benchmark federal paper grew 1.92% to 6.884 as compared with the previous close of 6.865.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 86.6150 compared with its close of 86.6100 during the previous trading session.

MCX Gold futures for 5 February 2024 settlement fell 0.53% to Rs 78,808.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.09% to 109.04.

The United States 10-year bond yield shed 0.17% to 4.598.

In the commodities market, Brent crude for March 2025 settlement added 22 cents or 0.27% to $81.51 a barrel. Oil prices rose on Friday, set for a fourth weekly gain as US sanctions on Russian energy tightened supply.

Global Markets:

The U.S. stock futures point to a positive open Friday, with the Dow Jones Industrial Average futures up 151 points.

European shares advanced and most Asian shares ended higher on Friday as positive economic data from China boosted sentiment.

China's economy grew by 5% year-on-year in 2024, with a notable upswing in the final quarter of the year. China's industrial production grew 6.2% year on year in December, government data showed on Friday. It compares to a 5.4% rise seen in the prior month. Meanwhile, Chinese retail sales rose 3.7% in December, accelerating sharply from the 3.0% rise seen in November.

Shares in Japan fell as the yen largely held onto gains from earlier in the week.

US markets weakened on Thursday after initial optimism surrounding softer-than-expected inflation data was tempered by robust retail sales and a resilient labor market. These data points suggested that the Federal Reserve may have more room to gradually slow down interest rate cuts.

The S&P 500 fell 0.2% to 5,937.33 points, while the NASDAQ Composite slid 0.9% to 19.338.29 points. The Dow Jones Industrial Average fell 0.2% to 43,153.13 points.

US retail sales climbed by 0.4% in December, reaching $729.2 billion, according to the US Census Bureau's report on Thursday. This figure was lower than November's 0.8% increase.

The number of Americans filing new applications for unemployment benefits increased more than expected last week but remained at levels consistent with a healthy labor market. Initial claims for state unemployment benefits rose 14,000 to a seasonally adjusted 217,000 for the week ended Jan. 11, the Labor Department said on Thursday.

Nonfarm payrolls increased by 256,000 jobs in December, while the unemployment rate dropped to 4.1% from 4.2% in November.

Investor attention also focused on the potential impact of President-elect Trump's policies, particularly his plans for increased trade tariffs.

New Listing:

Shares of Capital Infra Trust InvIT settled at Rs 98.79 on the NSE, a discount of 0.21% as compared with the issue price of Rs 99.

The scrip was listed at Rs 99, matching the issue price. The stock has hit a high of 99.20 and a low of 98. On the BSE, over 48.11 lakh shares of the company were traded in the counter.

Stocks in Spotlight:

Reliance Industries (RIL) added 2.57% after the company reported a 12% year-on-year increase in consolidated net profit to a record high of Rs 21,930 crore in the quarter ended December 31, 2024. This strong performance was driven by robust growth across its key business segments: digital services, retail, and oil-to-chemicals. RIL's Q3 revenue grew 7.7% to Rs 2.67 lakh crore.

Infosys tumbled 5.77%. The company reported a 4.61% rise in consolidated net profit to Rs 6,806 crore on a 1.89% increase in revenues to Rs 41,764 crore in Q3 FY25 over Q2 FY25. The total contract value (TCV) of large deal wins was $2.5 billion in Q3 of FY25, with a net new of 63%. It has raised FY25 guidance to 4.5%-5% in constant currency.

However, a foreign brokerage predicted a 1% sequential revenue decline in Q4, citing factors like potential reductions in third-party items or cautious management positioning. During the post-earnings call, Infosys management acknowledged the possibility of a softer Q4, citing potential headwinds such as slight furloughs, fewer working days, and reversals of third-party revenue. Additionally, investor concerns were heightened by uncertainty surrounding the potential margin impact of the company's planned two-phase wage hike.

LTIMindtree declined 1.52% after the company's consolidated net profit slipped 13.18% to Rs 1,086.7 crore in Q3 FY25 as compared with Rs 1,251.6 crore in Q2 FY25.Revenue from operations increased 2.36% QoQ to Rs 9,660.9 crore during the quarter.

Axis Bank slipped 4.71%. The bank's standalone net profit increased 3.83% to Rs 6,303.77 crore on a 10.17% jump in total income to Rs 36,926.14 crore in Q3 FY25 over Q3 FY24. Net interest income (NII) grew 9% YoY to Rs 13,606 crore. Net Interest Margin (NIM) stood at 3.93% in Q3 FY25.

The bank's results, which fell short of analyst expectations across all key metrics, triggered downgrades. Key concerns included higher slippages driven by agriculture and unsecured loans, elevated credit costs remaining the highest among the top 5 banks, and the slowest deposit growth compared to peers. While Q3 earnings appeared in line due to lower operating expenses offsetting higher provisions, analysts anticipate some weakness in the stock price. A domestic brokerage noted a slight deterioration in asset quality, with sequential increases in slippages, although NPA ratios remained relatively stable.

IDBI Bank jumps 5.61% after the company confirmed that the strategic disinvestment process is actively underway and being managed entirely by the Department of Investment and Public Asset Management (DIPAM).

SBI Life Insurance Company added 1.76% after the company reported 71.19% increase in net profit to Rs 550.82 crore despite a 52.21% fall in total income to Rs 18,542.16 crore in Q3 FY25 over Q3 FY24.

Bharat Petroleum Corporation rallied 2.47% after the company informed that it has executed a loan agreement of Rs 31,802 crore with State Bank of India consortium on 16 January 2024, to finance the projects planned at Bina.

Swaraj Engines rallied 6.08% after the company's net profit surged 32.57% to Rs 31.95 crore in Q3 FY25 as against with Rs 24.10 crore posted in Q3 FY24. Revenue from operations jumped 23.59% to Rs 345.50 crore

Aether Industries slipped 4%. The specialty chemicals maker reported 148.94% surge in consolidated net profit to Rs 43.39 crore on 41.4% rise in revenue from operations to Rs 219.68 crore in Q3 FY25 over Q3 FY24.

Amal hit an upper circuit of 20% after the company's consolidated net profit zoomed to Rs 16.53 crore in Q3 FY25 as compared with Rs 2.26 crore posted in Q3 FY24. Revenue from operations surged 77% to Rs 45.79 crore in Q3 FY25 as compared with Rs 25.87 crore in Q3 FY24.

Radhika Jeweltech hit an upper circuit of 5% after the company's consolidated net profit surged 45.1% to Rs 22.73 crore in Q3 FY25 as against Rs 15.67 crore posted in Q3 FY24. Revenue from operations rose 17.2% year on year (YoY) to Rs 206.06 crore in the quarter ended 31 December 2024.

Havells India added 1.33%. The home appliance company's standalone net profit shed 1.8% to Rs 282.81crore in Q3 FY25 as against Rs 287.87 crore posted in Q3 FY24. Revenue from operations rose 11% YoY to Rs 4,882.50 crore in the quarter ended 31 December 2024.

Indian Railway Catering and Tourism Corporation (IRCTC) rose 2.14% after the company informed that its board has appointed Sudhir Kumar, GGM (Finance), as chief financial officer (CFO) of the company effective from 16 January 2025.

IPO Update:

The initial public offer of Stallion India Fluorochemicals received bids for 49,73,74,020 shares as against 40,21,09,125 shares on offer, according to stock exchange data at 17:00 IST on 17 January 2025. The issue was subscribed 32.06 times.

The issue opened for bidding on 16 January 2025, and it will close on 20 January 2025. The price band of the IPO is fixed between Rs 85 and Rs 95 per share. An investor can bid for a minimum of 165 equity shares and in multiples thereof.

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