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Key gauges end higher for 2nd straight session
Jan-29-2025

Indian equity benchmarks ended higher for the second straight session on Wednesday as investors looked forward to positive cues in the upcoming Union Budget 2025-26. Also, there were some expectations that the Reserve Bank of India (RBI) will commence the rate easing cycle with a 25-basis point rate cut in the February 7 policy meeting, following recent liquidity measures.  

Some of the important factors for the markets:

About 64% of industrialists optimistic about India’s growth: Ahead of Union Budget on February 1, the FICCI in its Pre-budget 2025-26 Survey showed that about 64% of industrialists expressed optimism regarding India’s growth. It said nearly 60% of participants projected a GDP growth rate between 6.5% and 6.9% for 2025-26. 

RBI to conduct USD/INR swap auction of $5 Billion to inject liquidity: As part of its over Rs 1.5 lakh crore liquidity injection into the banking system, the Reserve Bank said it will conduct a USD/INR buy-sell swap auction of $5 billion (about Rs 43,000 crore) on January 31.

Falling US Treasury yield further boosted investor sentiments: U.S. Treasury yields were lower as investors awaited the Federal Reserve’s first interest rate decision of 2025. The Fed is widely expected to leave interest rates unchanged. 

Some cautiousness prevailed amid foreign fund outflow: Foreign institutional investors (FIIs) offloaded equities worth Rs 4,920.69 crore in the capital markets on net basis on Tuesday, according to exchange data. 

Global cues remained positive: European markets were trading mostly in green as global markets recovered from a tech selloff sparked by concerns over the emergence of a low-cost Chinese AI model. The Japan stock market -- Nikkei 225 ended higher as investors looked ahead to the Federal Reserve's interest-rate decision later in the day for direction. Several Asia-Pacific markets were closed for the Lunar New Year holiday.  

Finally, the BSE Sensex rose 631.55 points or 0.83% to 76,532.96, and the CNX Nifty was up by 205.85 points or 0.90% to 23,163.10.     

The BSE Sensex touched high and low of 76,599.73 and 75,975.80 respectively. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 2.54%, while Small cap index was up by 3.28%.

The top gaining sectoral indices on the BSE were Realty up by 3.10%, Industrials up by 2.94%, Capital Goods up by 2.70%, IT up by 2.65% and Basic Materials up by 2.30%, while FMCG down by 0.30% was the lone losing index on BSE.

The top gainers on the Sensex were Zomato up by 6.79%, Tata Motors up by 3.29%, Infosys up by 2.83%, Ultratech Cement up by 2.38% and Tech Mahindra up by 2.31%. On the flip side, Bharti Airtel down by 1.19%, Maruti Suzuki down by 1.18%, Asian Paints down by 0.87%, ITC down by 0.55% and Axis Bank down by 0.08% were the top losers.

Meanwhile, India Ratings and Research (Ind-Ra) has said that housing prices may rise 3-4 per cent next fiscal (FY26) on high base effect and better supply. It expects property prices to increase 5-6 per cent year-on-year (YoY) in FY25. It stated prices surged 21 per cent YoY in FY24 with old stock cleared and existing inventory largely liquidated.

It has maintained a neutral outlook for the residential real estate sector for the next fiscal. It said ‘Growth in bookings is likely to reduce significantly due to the high base, high prices and a likely slowdown in the luxury segment.’ Besides, it said the residential real estate market is expected to register a strong performance in FY25, where the sales growth will be around 17 per cent YoY in terms of area sold (square feet of area sold) and around 15 per cent in terms of units sold for the top eight real estate clusters. This growth will be largely driven by the premium and luxury segment sales.

Mahaveer Shankarlal Jain, Director, Corporate Ratings, Ind-Ra, said ‘FY26 is likely to see continued positive growth in bookings, although at a slower pace due to the base effect and moderation in affordability. Among the top eight cities, the National Capital Region, Bengaluru, and the Mumbai Metropolitan Region are likely to remain relatively resilient in bookings, except for the luxury segment.’ He added developers might continue to experience positive growth in collections and operating cash flows, leading to a sustained strong balance sheet.

The CNX Nifty traded in a range of 23,183.35 and 22,976.50. There were 42 stocks advancing against 9 stocks declining on the index. 

The top gainers on Nifty were Shriram Finance up by 3.98%, Bharat Electronics up by 3.72%, Tata Motors up by 3.65%, SBI Life Insurance up by 3.27% and Trent up by 3.11%. On the flip side, ITC Hotels down by 3.53%, Maruti Suzuki down by 1.41%, Asian Paints down by 0.81%, Bharti Airtel down by 0.78% and Britannia Industries down by 0.60% were the top losers.

European markets were trading mostly in green; UK’s FTSE 100 increased 11.15 points or 0.13% to 8,545.02 and Germany’s DAX gained 133.99 points or 0.63% to 21,564.57, while France’s CAC fell 16.68 points or 0.21% to 7,880.69.

Japanese market ended higher on Wednesday as weaker yen boosted export-related shares. Market sentiments improved further by Wall Street’s gains overnight as focus shifted to US mega-cap tech company earnings including Facebook owner Meta Platforms, Microsoft and Tesla, as well as the US Federal Reserve's first interest rate decision in 2025 due later in the day. Meanwhile most of the Asian regional markets including China, Hong Kong, Singapore and South Korea closed for Lunar New Year holidays. 

Japan’s Nikkei 225 gained 397.91 points or 1.01% to settle at 39,414.78.
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