Sensex, Nifty50 open on a positive note amid mixed global cues – Tata Motors, Yes Bank, Sun Pharma among stocks to watch out for

• India’s benchmark indices Sensex and Nifty50 opened on a positive note on Monday after ending the previous week in the red.
• The 30-stock Sensex opened 68 points higher at 61,406, while the 50-stock Nifty50 opened 19 points higher at 18,288.
• Tata Motors, Yes Bank, Sun Pharma are amongst stocks to watch out for on Monday.

India’s benchmark indices Sensex and Nifty50 opened on a positive note on Monday after ending the previous week in the red. Despite mixed global cues, SGX Nifty, an early indicator of how the markets may perform, was up 0.22%, or 41 points this morning.

The 30-stock Sensex opened 68 points higher at 61,406, while the 50-stock Nifty50 opened 19 points higher at 18,288.

Both the indices closed in the red for the second consecutive week on Friday – while Sensex closed 1.2% down in the previous week, Nifty50 closed 0.47% lower.

"The synchronised rate hikes by the leading central banks of the world and their hawkish tone impacted market sentiments last week with Nifty closing below the near-term support of 18400. While this risk-off can continue to impact the market, there are positive triggers too, like steadily declining inflation in the U.S. and the hope that the Fed will respond to this with a pause in rate hikes in early 2023. Therefore, market trends are likely to oscillate like the World Cup finals,” said V K Vijayakumar, chief investment strategist at Geojit Financial Services.

Sensex and Nifty50’s movement in the past two weeks reflected those of the US markets, which also closed in the red for the second consecutive week. The S&P 500, Dow Jones Industrial Average and Nasdaq declined between 0.85-1.11% on Friday as US Fed’s hawkish commentary spooked investors.

Asian markets were also trading lower on Monday with China’s Shanghai SE Composite Index falling the most by 1.25% followed by Nikkei 225 down 1.11%, Taiwan SE Weighted Index down 0.38% and Hang Seng 0.29% lower.

Foreign portfolio investors (FPI), however, continued to remain bullish on Indian equities, pumping in ₹10,555 crore in December so far. However, the flows have moderated from November when FPIs poured in ₹36,239 crore in Indian equities.

Forex reserves see a jump

India’s forex reserves rose for the fifth consecutive week. According to the Reserve Bank of India, India’s forex reserves increased by $2.91 billion to $564.07 billion. In the week ending December 2, however, forex reserves rose by $11.02 billion.

Gold reserves, however, saw a minor decline of $296 million to $40.73 billion.

Current account deficit to moderate on falling imports and exports

Ratings agency ICRA has said in its latest report that the current account deficit for FY23 is likely to be between $108-112 billion, or about 3.3% of India’s gross domestic product (GDP).

The Q3 FY23 deficit is likely to come in between $24-26 billion, down from a likely deficit of $31-34 billion in Q2 FY23, the ratings agency said.

Current account deficit refers to the excess of imports of goods and services over exports.

Stocks to watch out for on Monday

Tata Motors: The automaker announced that Bengaluru Metropolitan Transport Corporation (BMTC) has signed an agreement with its subsidiary company for the operation of 921 low-floor electric buses in the city for 12 years. It will also replace Dr. Reddy’s Laboratories in the S&P BSE Sensex index from today.

Sun Pharmaceuticals: The drug major has received a warning letter from the US health regulator for its Halol unit summarizing violations at the plant. Besides, the facility was already placed under import alert by the regulator earlier.

Yes Bank: The private lender has transferred ₹48,000 crore worth stressed loans to JC Flowers Asset Reconstruction company. This will aid improvement in the bank’s non-performing assets.

Tech Mahindra: The company has divested 100% stake in Dynacommerce Holdings B.V., a wholly owned subsidiary of the firm to Comviva Netherlands B.V., a step down subsidiary of the company.

Stocks under F&O ban

Balrampur Chini, BHEL, Delta Corp, Gujarat Narmada Valley Fertilizers & Chemicals, IRCTC and Punjab National Bank are stocks banned in the F&O list on Monday.

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