- India’s Nifty and Sensex rise on Thursday, cheer shrinking India’s trade deficit.
- Nifty and Sensex draw support from the advance in automobile and utility sector stocks.
- Nifty and Sensex traders eagerly await a fresh batch of US statistics.
The Sensex 30 and Nifty 50, India’s key benchmark indices, are trading listlessly after seeing modest gains in Thursday’s opening trades. The Indian indices take the positive lead from their Asian counterparts.
At the time of writing, the National Stock Exchange (NSE) Nifty 50 index is up 0.12% so far to trade at 21,870 while the Bombay Stock Exchange (BSE) Sensex 30 also adds 0.09% to near 71,900. The focus remains on India’s Trade Deficit data and the US Retail Sales report.
Stock market news
- Nifty and Sensex remain underpinned by impressive gains in the automobile and utility sector stocks.
- Additionally, India’s trade data for January showed a shrinking Trade Deficit to $17.49 billion, which added to the market optimism.
- Mahindra & Mahindra, Power Grid, BPCL, ONGC and NTPC are the top gainers in the Nifty 50 so far. While Axis Bank, Brittania, Hindustan Unilever, ITC and Apollo Hospitals remain a drag on Nifty.
- Automaker Hero Motocorp is in the news for the launch of the brand’s premium motorbike Mavrick 440.
- Aluminium producer Hindalco’s net profit rose 71.1% increased to Rs 2,331 crores but missed analysts’ estimates.
- The Indian Supreme Court strikes down electoral bonds, terming it as “unconstitutional”. The court further stopped SBI from issuing fresh bonds for political funding.
- The US stock markets closed higher on Wednesday, as investors weighed whether the Federal Reserve (Fed) can bring down inflation without de-railing the economy. Dow Jones, NASDAQ Composite, and the S&P 500 indices gained up to 1%..
- The Indian WPI inflation dropped to 0.27% in January, as against a 0.73% increase in December. The data missed the market consensus of 0.53%.
- The Lunar New Year holidays in China could keep the liquidity thin around the Indian indices.
- All eyes now turn toward the top-tier US Retail Sales report for trading impetus in Nifty and Senxex indices.
- Following Tuesday’s hot US Consumer Price Index (CPI) data, markets are pricing in a no Fed rate cut in March and a lower than 50% chance of easing in May.
Nifty 50 FAQs
The Nifty 50, or simply Nifty, is the most commonly followed stock index in India. It was launched in 1996 by the National Stock Exchange of India (NSE). It plots the weighted average share price of 50 of the largest Indian corporations, offering investors comprehensive exposure to 13 sectors of the economy. Each corporation’s weighting is based on its “free-float capitalization”, or the value of all its shares readily available for trading.
The Nifty is a composite so its value is dependent on the performance of the companies that make up the index, as revealed in their quarterly and annual results. Another factor is government policies, such as when in 2016 the government decided to demonetize 500 and 1000 Rupee banknotes. This led to a temporary cash shortage which negatively impacted the Nifty. The level of interest rates set by the Reserve Bank of India is a further factor as it determines the cost of borrowing. Climate change, pandemics and natural disasters are also drivers.
The Nifty 50 was launched on April 22, 1996 at a base level of 1,000. Its highest recorded level to date is 22,097 achieved on January 15, 2024 (this is being written in Feb 2024). The index first closed above the 10,000 level on October 17, 2017. The Nifty recorded its biggest daily decline on March 23, 2020 during the Covid pandemic, when it fell 1,125 points or 12.37%. The Nifty’s biggest gain in a single day occurred on May 18, 2009, when it rose 651 points after the results of the Indian elections.
Major corporations in the Nifty 50 include HDFC Bank, Reliance Industries, ICICI Bank, Tata Consultancy Services, Larsen and Toubro, ITC Ltd, Housing Development Finance Corporation Ltd and Kotak Mahendra Bank.
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