Sensex sheds over 200 points, Nifty below 17,900; Torrent Power, Eicher Motors surge up to 8%

Domestic benchmark indices opened lower on Wednesday tracking the weaker global cues, hinting towards the cautious stance of traders after US inflation data which lifted the fears of a prolonged high-interest rate regime in the world's largest economy.

High-weightage IT and FMCG stocks topped among the laggards, whereas realty and auto stocks provided some support. However, rising inflation continues to remain a concern for global equities. Market analysts believe that uncertainty may continue in the near term.

At 9.25 am, the BSE Sensex was trading 225.95 points, or 0.37 per cent, down at 60,806.31. NSE's Nifty50 was down 60.35 points, or 0.34 per cent, to 17,869.50. Broader markets outperformed the headline peers as BSE midcap and smallcap indices were trading slightly up. Fear gauge India VIX eased about 3 per cent to 13.10-level.

The index started the week on a positive note and continued to inch northward as intraday dips were bought into. The daily price action formed a bull candle carrying higher high-low, indicating the resumption of primary up trend. The index closed above 20 days’ EMA, which has been acting as a hurdle in five instances, said ICICIDirect Research.

"Going ahead, a decisive move above the upper band of consolidation coinciding at around 18,000 will confirm the conclusion of corrective bias and open the door for an up move towards 18,300 in coming weeks as it is 61.8 percent retracement of the entire correction. Thus, temporary breathers should be capitalized on as an incremental buying opportunity," he said.

Among the sectors, Nifty FMCG index dropped more than a per cent, whereas IT and Pharma indices also posted significant falls. On the other hand, Nifty Auto, Realty and PSU Bank indices led the gainers, whereas Media and Metal indices were also up.

Among the Adani Group stocks, Adani Enterprises jumped 3 per cent as the company returned to black in the December quarter. Adani Ports, Adani Wilmar and Ambuja Cements jumped 2 per cent each, whereas ACC was up about a per cent for the day.

Adani Transmission, Adani Total Gas, Adani Green Energy and Adani Power continued to hit their lower circuits of 5 per cent, each. NDTV was down more than 3 per cent in the early trading hours.

In the Nifty50 pack, Apollo Hospitals dropped 2 per cent after a muted performance in the December 2022 quarter. HUL, Sun Pharma, TCS and Larsen & Toubro shed over a per cent each. On the other hand, Eicher Motors, 4 per cent up, topped the gainers among blue chips. HDFC Life Insurance, Reliance Industries and Grasim gained over a per cent, each.

The much-awaited US CPI inflation for January has come at 6.4 per cent. The takeaway from this data is that while the disinflationary process is on track, it is very slow. This means the Fed might hike rates again and the rates might remain higher for a longer period of time, said VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"A positive trend in India is that FIIs have turned buyers and this is good news for the bulls. But the rally is unlikely to sustain since there are no major triggers to take the Nifty beyond 18,200. Since the major drag of sustained FII selling appears out of the way, a sharp correction in the market is unlikely," he said.

In the broader markets, Torrent Power surged over 8 per cent after the strong quarterly performance. GMDC surged 7 per cent, whereas PI Industries gained 6 per cent in the early trade. Likhita Infra and Neuland Labs were up 5 per cent, each.

On the contrary, Kitex Garments plunged 12 per cent after disappointing quarterly results. EKI Energy continued to hit lower circuit as the stock plunged another 10 per cent after the circuit filter revision. Jindal Polyfilms, Supriya Lifesciences and Uflex slipped 6-9 per cent.

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