Indian Stock Market Weekly Update: Decline Driven by Weak Corporate Earnings: Indian stock market indexes ended lower for the second consecutive week, with HCL Tech and Infosys as the top losers. The Nifty index closed below the 23250 level. The weak corporate earnings in Infosys, HCL tech, and Axis Bank dented the market sentiments during the week.
Meanwhile, the market got some support after the better-than-expected CPI inflation data was released in the US and UK during the week, on the expectation of more rate cuts by the US Fed. The current earnings season will be pivotal in shaping the market’s trajectory in the coming days. Weak corporate earnings may linger the negative sentiment and accelerate the market’s downturn.
Sensex and Nifty This Week
In the week ending Friday, January 17, 2025, the BSE Sensex declined 759.58 points, or 0.98%, to settle at 76619.33, while the Nifty index plunged 228.30 points, or 0.97%, to settle at 23203.20. The broader markets outperformed the benchmarks, as the BSE Midcap index fell 0.01% and closed at 43761.23, while the BSE Small-Cap index declined 0.78% and ended at 52311.31.
Among the sectors, the NSE PSU Bank, Metal, and Energy sectors ended in the green, while the Nifty IT, Realty, and Media sectors fell the most during the week. Foreign Investors were the net sells in all five trading sessions this week, they offloaded shares worth Rs 25218.6 Cr. Meanwhile, the Domestic Institutional investors were buyers in all five trading sessions, and they bought shares worth Rs 25151.27 Cr.
Indian Economic News Impacted the Stock Market This Week
The data released by the RBI last Friday showed that the country’s foreign exchange reserves declined by $5.7 billion, reaching $634.59 billion for the week ending January 3, markets reacted negatively on Monday.
Meanwhile, wholesale price inflation in India rose to 2.37% in December 2024 as per data released on Monday. This is due to a surge in manufactured product prices, despite a decline in food prices. Government data released on Tuesday, January 14, 2025, indicated that the Wholesale Price Index (WPI)-based inflation was 1.89% in November 2024 and 0.86% in December 2023.
Global Stock Markets News and Economic Data This Week
On the global front, the US stock market indexes, Nasdaq, Dow Jones Industrial Average (DJIA), and S&P 500 ended higher this week. In the US, the financial sector had a strong run due to some better-than-expected results at the start of the earnings season. Shares of JPMorgan Chase, Goldman Sachs, Citigroup, and Wells Fargo went up as these major banks reported big jumps in their fourth-quarter profits.
The main highlight this week was the December inflation report, released on Wednesday. While overall inflation showed an increase from November, core inflation (excluding food and energy) rose by just 0.2% in December. This was slightly lower than the previous month and the smallest rise since July.
The other global economic data this week were
– China’s exports and imports in December exceeded expectations. Exports grew 10.7% year-over-year (vs. 7.3% expected), and imports unexpectedly rose 1% (vs. a 1.5% decline expected).
– The US added 256,000 nonfarm jobs in December, the largest gain since March, lowering the unemployment rate to 4.1%.
– UK inflation slowed in December, with the CPI rising 2.5% YoY (down from 2.6% in November) and core CPI increasing 3.2% (vs. 3.5% in November).
– The US Producer Price Index (PPI) rose 0.2% in December, slightly below expectations, and remained unchanged from the previous reading.
– China’s economy grew by 5% in 2024, with industrial production up 6.2% YoY and retail sales rising 3.7% in December.
– US retail sales increased 0.4% in December, reaching $729.2 billion, though growth slowed compared to November’s 0.8% rise.
– Initial US unemployment claims rose by 14,000 to 217,000 for the week ending January 11.
Conclusion
Indian stock markets ended lower for the second straight week, with weak corporate earnings from Infosys, HCL Tech, and Axis Bank weighing on sentiment. Despite some support from better-than-expected US and UK inflation data, foreign investors remained net sellers throughout the week. With the earnings season underway, market direction will largely depend on the performance of key sectors and companies in the coming days.
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