 "Market Today: GIFT Nifty; RIL, Infy, Axis Bk Q3; Laxmi Dental IPO allotment")
Stock Markets Today, January 16, 2025: The benchmark indices, Sensex and Nifty50, are likely to be influenced by Q3 earnings, foreign institutional investor (FII) activity, and global market trends on Thursday, January 16, 2025.
At 6:35 AM, GIFT Nifty futures indicated a gap-up opening for the markets, trading 150 points higher at 23,416.
In the previous session, the Sensex advanced 224.45 points (0.29 per cent) to close at 76,724.08, while the NSE Nifty50 ended higher at 23,213.20, recording a gain of 37.15 points (0.16 per cent).
Domestic cues
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The spotlight today will be on Q3 earnings as major players like Infosys, Reliance Industries Limited (RIL), and Axis Bank prepare to announce their results.
Analysts suggest RIL's core business may weigh down its financial performance for Q3FY25, with Ebitda (earnings before interest, taxes, depreciation, and amortisation) expected to remain flat or show a slight decline compared to the previous year.
Infosys, a key player in India’s IT sector, is set to report its October-December quarterly earnings for FY25. Projections indicate a 6.3 per cent year-on-year rise in average revenue, reaching Rs 41,298 crore compared to Rs 38,821 crore in Q3FY24. Sequentially, revenue is expected to grow modestly by 0.7 per cent from Rs 40,986 crore in the previous quarter.
Axis Bank will lead the earnings announcements for large-cap private banks for Q3FY25. Market analysts predict a weaker performance, citing slow loan and deposit growth, margin pressure, and deteriorating asset quality as contributing factors.
Additionally, companies such as Havells India, LTIMindtree, D B Corp, Wilson Renewable Energy, and Waaree Renewable Technologies are among others set to disclose their Q3 financial results today.
The Indian financial markets are expected to face heightened volatility in early 2025, influenced by domestic and global uncertainties, including policies under the Donald Trump administration and the upcoming Union Budget.
Meanwhile, Indian firms’ overseas borrowings saw a steep 20.2 per cent decline in 2024, dropping to $23.33 billion from $29.22 billion in the previous year. With the rupee weakening against the dollar, repayment costs and forward cover prices have risen, leading analysts to predict further reductions in overseas debt by corporate India.
Other market triggers
FII, DII activity
FIIs sold shares worth Rs 4,533.49 crore on January 15, while DIIs bought shares worth 3,682.54 crore.
IPO market
Stallion India IPO (Mainline) and Landmark Immigration IPO (SME) will open for susbcriptiom. Rikhav Securities IPO (SME) and Kabra Jewels IPO (SME) will enter Day 2 of their subscription.
Meanwhile, the Laxmi Dental IPO (Mainline) and Barflex Polyfilms IPO (SME) will see their allotment.
Global cues
Asia-Pacific markets advanced on Thursday, buoyed by a surge in US markets following an unexpected decline in core inflation for December and robust earnings reports from major banks.
In South Korea, the central bank surprised analysts by maintaining its benchmark interest rate at 3 per cent, defying expectations of a 25-basis-point cut as projected by a Reuters poll. The decision spurred market optimism, with the Kospi rising 1.18 per cent.
Japanese markets also saw gains, as the Nikkei rose 0.7 per cent, and the Topix edged up 0.24 per cent. The country’s annual producer price index increased by 3.8 per cent in December, aligning with economists’ forecasts.
The ASX 200 climbed 1.38 per cent. The nation is set to release its unemployment data for December later in the day, with expectations of a slight increase to 4 per cent from November’s 3.9 per cent, as predicted by Reuters’ survey.
Meanwhile, US markets enjoyed major gains overnight, marking their strongest performance since November 6. The Dow Jones jumped 1.65 per cent, while the S&P 500 and Nasdaq surged 1.83 per cent and 2.45 per cent, respectively.
The benchmark 10-year Treasury yield saw a sharp drop, declining approximately 13 basis points to around 4.65 per cent, following the release of the CPI report.
Commodity market
Gold prices continued to climb on Wednesday as the US dollar weakened following softer-than-expected core inflation data, which eased inflationary concerns and reignited speculation about the Fed's potential for further easing measures. Spot gold rose 0.6 per cent to $2,693.63 per ounce, while US gold futures increased by 1.3 per cent, settling at $2,717.80.
Oil prices saw a major uptick, gaining over 2 per cent amid a substantial draw in US crude inventories and the possibility of supply disruptions due to new US sanctions on Russia. However, gains were tempered by a ceasefire agreement in Gaza. Brent crude futures remained steady at $82.42 per barrel, while US WTI crude advanced by 3.19 per cent to $79.97 per barrel.
Here's how analysts are assessing today's (January 16) trading session:
Shrikant Chouhan, head of equity research at Kotak Securities
On the higher side, 23,260/76,800 would be the key level to watch out, above the same market could bounce back till 23,350-23,400/77,100-77,200. On the other side, below 23,130/76,300 the selling pressure is likely to accelerate. Below the same, the market could retest the level of 23,000/75,900. Further down side may also continue which could drag the index up to 22,950/75,700.
Rupak De, senior technical analyst at LKP Securities
The sentiment is likely to favour a recovery in the short-term, with the potential to reach 23,400 on the higher end. The sentiment is expected to remain positive as long as the market stays above 23,000. A buy-on-dips strategy appears to work well in the current scenario.