Sensex, Nifty off to muted start on weak Asian markets, US futures

NEW DELHI: Benchmark indices opened on a tepid note on Tuesday morning as weak cues from Asia and a fall in S&P500 futures early morning offset optimism over overnight gains on Wall Street.

At 9.49 am, the BSE Sensex was trading 112 points or 0.22 per cent lower at 54,176. Nifty50 was trading at 16,164, down 50 points or 0.31 per cent. Midcap and smallcap indices rose up to 0.4 per cent.

"The undertone is expected to remain upbeat till the index holds the 16,000 psychological mark," said Sameet Chavan of Angel One, who believes the index is likely to remain in the slender range and traders should stay abreast with global and domestic developments on a regular basis.

climbed 6.93 per cent to Rs 60.95. JPMorgan said adjusted Ebitda losses continued to decline and that gross order value (GOV) saw strong growth in the March quarter, with the brokerage suggesting a price target of Rs 130 on the stock. Citi has a target of Rs 80 on the stock as it revised its estimates to incorporate FY22 numbers.

M&M rose 1.37 per cent to Rs 954.95. advanced 1.1 per cent to Rs 912.50. , HDFC, , SBI and advanced up to 0.9 per cent. , , , and were some of the Sensex gainers rising up to 0.8 per cent.

Losers included , which fell 2.36 per cent to Rs 2,323.85. ITC, , TCS and fell up to 0.5 per cent.

"Valuation on a forward P/E basis has contracted by 21 per cent since the peak of October 2021 (22.8 times to 18 times currently). Fundamentally, valuation contraction due to the impending rate hike cycle by global central banks was a foregone conclusion. However, the speed at which rate hikes were conducted took capital markets by surprise, thereby resulting in aggressive expectations of further rate hikes," said in a note.

The brokerage said that if further aggressive rate hikes do not materialise, it will be a positive surprise for equities. Meeting expectations of aggressive rate hikes will keep equity valuations subdued although the shock and awe situation will recede, the brokerage added.

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