Sensex, Nifty to open higher; Paytm, HPCL, NTPC, IDFC, Wipro shares in focus

Indian equity benchmarks, the BSE Sensex and the NSE Nifty, are set to open higher on Friday, tracking strong cues from Asian peers, which rallied despite negative closing at Wall Street overnight. The surge in Asian market was boosted by a report that the Chinese government will ramp up support for the economy rattled by Covid-19 pandemic. The solid trends on SGX Nifty also indicated a gap-up opening for the domestic bourses, with SGX Nifty futures trading 207 points, or 1.3%, higher at 15,992 on the Singapore Stock Exchange at 8:30 AM. Investors will also keep an eye on corporate earnings as some major companies such as Paytm, NTPC, Amara Raja Batteries, Gati, Zydus Lifesciences, IDFC, Indigo Paints, will release their March quarter earnings.

On Thursday, the Indian equities ended lower for the second straight session, in line with global equities amid mounting concerns about aggressive policy hike by central banks across the globe. The benchmark indices BSE Sensex ended 1,416 points, or 2.61%, lower at 52,792, and the NSE Nifty tumbled 431 points, or 2.65%, to 15,809. The BSE IT index was the worst performer, crashing 5.25%, or 1,600 points, to settle at 28,868 levels in a bearish trade on Thursday. Investors lost ₹6.71 lakh crore in value, as market capitalisation of BSE listed companies dropped to ₹249.20 crore on May 19 from ₹255.77 lakh crore on May 18. The top losers on the BSE Sensex pack were HCL Tech, Infosys, TCS, Tech Mahindra, Tata Steel, IndusInd Bank, and Kotak Mahindra Bank.

Shares to watch

Fortis Healthcare: Capital markets regulator SEBI has levied ₹38.75 crore fine on 32 entities, including Fortis Healthcare Holdings, in a case related to diversion of funds of Fortis Healthcare Ltd (FHL) and misrepresentations to conceal the fraud.

Wipro: The IT major has launched its new innovation studio at Austin in Texas, U.S. The new centre, spread over 40,000 square feet, will create hundreds of jobs locally.

Hindustan Petroleum Corporation Ltd (HPCL): The state-run oil company has reported a 40% fall in net profit at ₹1,795.26 crore in January-March quarter of 2022, compared with ₹3,017.96 crore a year back.

Ashok Leyland: The Hinduja group flagship has posted a 58% YoY decline in consolidated net profit at ₹157.85 crore in the fourth quarter ended March 2022, weighed down by higher expenses.

Bosch: The auto components major has reported a 27.28% drop in consolidated net profit at ₹350.5 crore in the fourth quarter ended March 2022, as against ₹482 crore in the same period previous fiscal.

Go Fashion (India): The company will be in focus as ICICI Venture through its fourth private equity fund -- India Advantage Fund S4 I on Thursday sold 18.11 lakh shares of Go Fashion for ₹190 crore through an open market transaction.

Godrej Consumer Products Ltd (GCPL): The FMCG major has posted a marginal decline in consolidated profit after tax at Rs 363.24 crore for the fourth quarter ended March 2022, against Rs 365.84 crore in the year-ago period.

F&O ban: Shares of Delta Corp, GNFC, Indiabulls Housing Finance, and Punjab National Bank will be under F&O ban today as their securities have crossed 95% of the market-wide position limit.

Here are the key things investors should know before the market opens today:

Tech stocks drag Wall Street lower

In the overnight trade, all three major U.S. indices closed lower, weighed down by technology stocks as weak earnings outlook by tech giant Cisco Systems dented market sentiments. The persistent concerns about aggressive policy hike by the Federal Reserve to combat boiling inflation also trigged sell-off in the market. After a record slump in the previous session, the S&P 500 closed 0.6% lower, the tech-heavy Nasdaq Composite shed 0.3%, and the Dow Jones index dropped 0.8%.

Asian stocks rebound

Shares in the Asia-Pacific region rebounded strongly in opening trade on Friday, undermining weak cues from Wall Street which tumbled overnight. The market sentiment was lifted after lockdown restrictions in China were eased while the Chinese government committed to boost infrastructure spending also cheered investors.

Regional heavyweight Japan’s Nikkei 225 rose 1.2%, South Korea’s KOSPI rallied 1.7%, the Straits Times Index in Singapore rallied 1.4%, and Australia’s ASX 200 rose 1.2%. Taiwan’s Weighted index rose 0.5%, while Indonesia’s Jakarta Composite climbed 1.1%.

The Hang Seng index in Hong Kong was the best performer in the regional market with a 1.8% gain. In mainland China, the Shenzhen Component and the Shanghai Composite rose 0.8% each in early trade.

Crude prices fall below $110

The price of Brent and U.S. crude was trading below $110 per barrel on Friday, following a sell-off in global equities amid concerns about global economic growth. The U.S. crude stockpiles also dropped for the third consecutive week by 3.4 million barrels. In Asian trading hours, the Brent oil for July delivery rose 0.9% to $111 per barrel, while the U.S. West Texas Intermediate (WTI) crude June futures fell 1.1% to $108.6 a barrel.

FIIs remain net sellers, DIIs net buyers

The foreign institutional investors (FIIs) continued to remain net sellers in the Indian equity market on May 19, while domestic institutional investors (DIIs) continued to support the market. As per the exchange data, FIIs net sold shares worth ₹4,899.92 crore, while DIIs net purchased shares worth ₹3,225.54 crore.

Corporate earnings

The major companies that are expected to release their March quarter earnings today include NTPC, One 97 Communications (Paytm), Amara Raja Batteries, Gati, HeidelbergCement India, Indiabulls Housing Finance, IDFC, Indigo Paints, Indian Railway Finance Corporation, JK Tyre and Industries, CE Info Systems, Metro Brands, Narayana Hrudayalaya, Nuvoco Vistas Corporation, Paras Defence and Space Technologies, Pfizer, SML Isuzu, Sobha, Thermax, and Zydus Lifesciences.