Key equity benchmarks continued to trade with modest losses in afternoon trade. At 13:20 IST, the barometer index, the S&P BSE Sensex, was down 92.59 points or 0.28% at 33,750.04. The Nifty 50 index was down 35 points or 0.31% at 10,365.65. Weakness in Asian stocks weighed on sentiment.
Meanwhile, the minutes of the last meeting of the Reserve Bank of India held on 6-7 February 2018 showed that monetary policy committee members were concerned about accelerating inflation as well as uncertainty about the strength of an economic recovery.
Trading could be volatile as traders roll over positions in the F&O segment from the near month February 2018 series to March 2018 series. The February 2018 F&O contracts expire today, 22 February 2018.
Domestic stocks nudged lower in early trade on negative Asian stocks. Stocks hovered in negative zone in morning trade. Key benchmark indices continued to trade in a small range in negative zone later during the day so far.
The S&P BSE Mid-Cap index was down 0.31%. The S&P BSE Small-Cap index was down 0.15%. Both these indices outperformed the Sensex.
The market breadth, indicating the overall health of the market, was weak. On the BSE, 1,527 shares fell and 973 shares rose. A total of 160 shares were unchanged. Breadth was weak till morning trade. It turned negative in mid-morning trade.
IT stocks extended recent gains on weak rupee. Rupee fell past 65-mark against the dollar. Infosys was up 0.52%, Wipro 0.15%, HCL Technologies 1.8%, Tech Mahindra 1.27%, Hexaware Technologies 1.74% and Mphasis rose 2.91%. However, TCS dropped 0.13%. Weakness in rupee could boost sales of IT companies in rupee terms as IT firms derive substantial revenue from exports.
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Capital goods stocks dropped. L&T was down 0.19%, ABB India 0.43%, Siemens 1.27%, BEML 0.65%, Bharat Electronics 1.79%, Havells India 0.68%, and Bharat Heavy Electricals dropped 0.01%. However, Thermax rose 0.49%.
Steel Strips Wheels rose 2.17% after the company announced commissioning of its Chennai truck wheel plant from February 2018. This plant will add 1.2 million wheels capacity to the already existing 1.8 million wheels capacity for the truck/trailer segment of the company. The total capacity of truck wheel segment now stands at 3 million wheels and with this the company will be the largest truck steel wheel maker in India. The announcement was made during trading hours today, 22 February 2018.
Ramco Systems advanced 2.39% after a leading global supply chain solution provider announced a partnership with the company. The announcement was made during market hours today, 22 February 2018.
Today ITOrizon Inc, one of the world's foremost supply chain solution providers, announced its partnership with Ramco Systems, a global enterprise software company focusing on enterprise cloud platform, products and services, to help enterprises make smarter business decisions and drive excellent customer success. This partnership will draw new insights from Ramco directly into the ITOrizon customer success platform.
Meanwhile, the minutes of the Monetary Policy Committee meeting held on 6-7 February 2018 released yesterday, 21 February 2018, showed that though prices eased in December, the winter seasonal food price moderation was less than usual. Domestic pump prices of petrol and diesel rose sharply in January, reflecting lagged pass-through of the past increases in international crude oil prices. Considering these factors, inflation is now estimated at 5.1% in Q4, including the house rent allowance (HRA) impact. The RBI had kept the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6% in the last meet.
The MPC noted that the inflation outlook is clouded by several uncertainties on the upside. There is, therefore, need for vigilance around the evolving inflation scenario in the coming months, it added.
Overseas, most Asian shares slipped as speculation of faster hikes in US interest rates soured risk appetite globally. US stocks ended a tumultuous session yesterday, 21 February 2018 firmly lower after minutes from the Federal Reserve's most recent policy-setting meeting sparked a fresh wave of volatility. Minutes of the January 30-31 Federal Open Market Committee meeting showed that officials saw a stronger economy than at the end of 2017 and that more rate increases were in the offing.
An index that tracks US manufacturers rose to a nearly 3-year high in February and a gauge for service-oriented companies hit a six-month peak, according to IHS Markit's flash PMI. The manufacturing index rose to 55.9 from 55.5. The services barometer climbed to 55.9 from 53.3.
Meanwhile, trading of US index futures indicated that the Dow could fall 106 points at the opening bell today, 22 February 2018.
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