Indices end with modest cuts; Nifty settles below 18,050

The domestic equity benchmarks ended near the day's low with moderate losses on Friday. The Nifty closed below the 18,050 mark after hitting the day's high of 18,145.45 in mid-morning trade. Banking and financial services stocks advanced while media, consumer durables and FMCG shares were under pressure.

As per provisional closing data, the barometer index, the S&P BSE Sensex shed 236.66 points or 0.39% to 60,621.77. The Nifty 50 index declined 80.20 points or 0.44% to 18,027.65.

In the broader market, the S&P BSE Mid-Cap index fell 0.66% while the S&P BSE Small-Cap index shed 0.50%.

The market breadth was negative. On the BSE, 1,570 shares rose, and 1,916 shares fell. A total of 153 shares were unchanged.

 

Investor sentiment remained negative after the US reported lower-than-expected weekly unemployment claims, a sign of a robust labour market. This might result in the Fed maintaining its aggressive rate hike policy, increasing the likelihood that the world's largest economy would experience a recession.

Earnings Impact:

Hindustan Unilever fell 3.74%. The FMCG major reported 12% rise in standalone net profit to Rs 2,505 crore on a 16% increase in turnover to Rs 14,986 crore in Q3 FY23 over Q3 FY22.

The company's board approved the proposal to enter a new arrangement wherein it will now be paying royalty and central services fees to Unilever Group at 3.45% of turnover, up from 2.65% in FY22. This increase will be affected in a staggered manner over a period of 3 years, the company said.

Hindustan Zinc tumbled 6.42% after the mining company's consolidated net profit slipped 20.2% to Rs 2,156 crore from Rs 2,701 crore recorded in Q3 FY22. Revenue from operations during the quarter was Rs 7,866 crore, down 1.6% year on year (YoY), on account of lower LME coinciding with lower refined metal and silver volumes partially offset by favourable exchange rates and gains from strategic hedging.

HDFC Life Insurance Company shed 2.41%. The company reported 15.19% increase in standalone net profit to Rs 315.22 crore in Q3 FY23 as against Rs 273.65 crore posted in Q3 FY22. The life insurer's net premium income jumped 18.6% to Rs 14,379.38 crore in quarter ended 31 December 2022 as compared with Rs 12,124.36 crore recorded in Q3 FY22

Coforge jumped 3.37% after the company reported 13.5% rise in consolidated net profit to Rs 228.2 crore on a 4.9% increase in gross revenues to Rs 2,055.8 crore in Q3 FY23 over Q2 FY23.

L&T Technology Services (LTTS) slipped 4.81%. The company reported a 7.51% rise in consolidated net profit to Rs 303.60 crore on 2.68% increase in revenue from operations to Rs 2,048.60 crore in Q3 FY23 over Q2 FY22.

IndiaMART InterMESH rose 1.48% after the company's consolidated net profit jumped 61% to Rs 113 crore on 34% rise in net sales to Rs 251 crore in Q3 December 2022 over Q3 December 2021.

AU Small Finance Bank shed 0.68%. The bank reported 30% jump in net profit to Rs 393 crore on a 41% rise in net interest income to Rs 1,153 crore in Q3 FY23 over Q3 FY22. Net interest margin (NIM) for the quarter was stable at 6.2%. Total income increased by 36% YoY to Rs 2,413 crore in Q3 FY23.

Union Bank of India skid 0.55%. The bank reported a net profit of Rs 2,245 crore in Q3 FY23, which is significantly higher as compared with a net profit of Rs 1,085 crore recorded in the same period last year. Total income during the quarter increased 24% YoY to Rs 24,154 crore.

Mphasis slipped 2.25% after the IT reported 1.5% fall in consolidated net profit to Rs 412.3 crore on a 0.4% declin in revenue from operations to Rs 3,506.2 crore in Q3 FY23 over Q2 FY23.

Global Markets:

Stocks in Europe and Asian advanced on Friday as investors digested Japan's inflation data. The nationwide core consumer price index rose 4% in December on an annualized basis, the fastest pace since 1981. The reading climbed from the inflation print of 3.7% seen in November.

The People's Bank of China left the loan prime rates for 1-year and 5-year unchanged, widely in line with expectations. The 1-year LPR stayed at 3.65% while the 5-year LPR remained at 4.3%, both unchanged since August, 2022.

US stocks fell Thursday as investors grew increasingly concerned the Federal Reserve will keep raising rates despite signs of slowing inflation.

Boston Federal Reserve President Susan Collins said Thursday that she thinks the central bank can enact smaller interest rate hikes after a series of aggressive moves last year. Collins said she is reasonably optimistic that there is a pathway to reducing inflation without a significant economic downturn.

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