Benchmarks extend gains; Nifty above 23,300; HDFC Life spurts over 8%

The headline equity barometers extended gains in the afternoon trade, supported by strong global cues. Notably, the closure of Hindenburg Research and favorable developments in the Israel-Hamas ceasefire contributed to the markets upward movement. The Nifty marched above the 23,300 level. Banking, metal and realty shares advanced while FMCG, consumer durables and pharma shares corrected. Trading was volatile due to the weekly F&O series expiry today.

At 13:30 IST, the barometer index, the S&P BSE Sensex, rose 336.78 points or 0.44% to 77,060.86. The Nifty 50 index added 108.90 points or 0.47% to 23,322.10.

The broader market outperformed the headline indices. The S&P BSE Mid-Cap index added 0.88% and the S&P BSE Small-Cap index rallied 1.38%.

The market breadth was strong. On the BSE, 2,772 shares rose and 1,115 shares fell. A total of 113 shares were unchanged.

Economy:

Indias trade deficit widened to $21.94 billion in December from $18.76 billion a year ago as merchandise exports contracted for the second month in a row, data released Wednesday showed. Exports contracted by about 1% year-on-year to $ 38.01 billion due to global uncertainties, while imports rose by about 5% to $ 59.95 billion. Gold imports in December amounted to $4.7 billion.

However, the merchandise trade deficit narrowed in December compared with November. The government had revised Novembers gold imports to $9.84 billion from $14.86 billion announced earlier. The correction had lowered the November trade deficit to $32.8 billion from a record $37.8 billion estimated earlier.

Gainers & Losers:

HDFC Life Insurance Company (up 8.15%), Bharat Electronics (BEL) (up 3.27%), Shriram Finance (up 2.94%), Adani Ports and Special Economic Zone (up 2.38%) and SBI Life Insurance Company (up 2.37%) were the major Nifty gainers.

Trent (down 2.98%), Dr. Reddys Laboratories (down 2.36%), Tata Consumer Products (down 2.22%), HCL Technologies (down 2.06%) and Wipro (down 1.78%) were the major Nifty losers.

HDFC Life Insurance Company surged 8.15% after the companys consolidated net profit jumped 14.6% to Rs 421.31 crore despite of 36.1% decline in Total income to Rs 17,270.97 crore in Q3 FY25 over Q3 FY24.

Stocks in Spotlight:

L&T Technology Services jumped 7.69%. The companys consolidated net profit fell 4.1% to Rs 322.40 crore in Q3 FY25 as compared with Rs 336.20 crore in Q3 FY24. Net sales increased 9.5% YoY to Rs 2,653 crore during the quarter.

Punjab & Sind Bank rallied 7.75% after the banks standalone net profit surged 146.7% to Rs 281.96 crore in Q3 FY25 as compared with Rs 114.31 crore in Q3 FY24. Total income jumped 14.6% YoY to Rs 3,269.37 crore in Q3 FY25.

Mahindra EPC Irrigation hit an upper circuit of 20% after the company's consolidated net profit climbed 280.6% to Rs 6.35 crore in Q3 FY25 as against Rs 1.67 crore posted in Q3 FY24. Revenue from operations rose by 1.4% year on year to Rs 81.45 crore in the quarter ended 31 December 2024.

Rail Vikas Nigam (RVNL) soared 8.43% after the company announced the receipt of a letter of acceptance (LoA) from Bharat Sanchar Nigam (BSNL) for a project worth Rs 3,622.14 crore.

Global Markets:

European and Asian shares advanced on Thursday, mirroring Wall Street's gains, as a softer-than-expected US core inflation report revived hopes for Federal Reserve interest rate cuts later this year.

South Korea's central bank unexpectedly left its policy interest rate unchanged on Thursday, weighing the impact of its back-to-back rate cuts last year while supporting the won which weakened to a 15-year low versus the U.S. dollar in recent weeks.

The Bank of Korea held its benchmark interest rate at 3.00% at its monetary policy review, an outcome expected by only seven of 34 economists polled by Reuters. The remaining 27 had expected the bank to cut the rate by 25 basis points.

In its statement, the BOK said that while inflation had stabilized and household debt had slowed down, downside risks to economic growth have intensified and the volatility of exchange rates has increased due to the unexpected political risks that have recently escalated. The bank also said that uncertainty has also increased due to changing domestic political situation and economic policies in major countries.

The US core consumer price index (CPI), which excludes volatile food and energy prices, increased by 0.2% in December, marking the first slowdown in six months. This eased concerns about inflation and bolstered expectations that the Fed might begin cutting rates sooner than previously anticipated. Swap traders are now fully pricing in a rate cut by July, a significant shift from the expectations of a September or October cut following Friday's strong jobs report.

The year-over-year increase in core CPI was 3.2%, still above the Fed's 2% target. However, the deceleration in the monthly rate provided confidence that inflation is gradually cooling down.

Wall Street experienced a sharp rally on Wednesday, fueled by a combination of positive bank earnings and the encouraging inflation data. The S&P 500 surged 1.8%, the NASDAQ Composite climbed 2.5%, and the Dow Jones Industrial Average jumped 1.7%.

JPMorgan Chase, Wells Fargo, Goldman Sachs, and Citigroup, among other major banks, reported strong fourth-quarter earnings, setting a positive tone for the upcoming earnings season. Asset manager BlackRock also delivered robust results.

In other news, shares of Brazilian airline Azul SA soared over 4% after announcing a non-binding agreement to explore a merger with rival Gol, a move that would create Brazil's largest airline operator.

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