Teeter-totter

Nifty50: 15,556 ▲ 143 (+0.9%)
Sensex: 52,265 ▲ 443 (+0.8%)

Hola people!

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• After a strong opening, markets faltered briefly but recovered later and closed on a positive note.
• In all, 45 of the Nifty50 stocks closed in the green.
• Meanwhile, the US Fed chairman on Wednesday hinted at the possibility of a recession in the country.

Among the Nifty sectoral indices, Auto (+4.3%) and IT Services (+1.9%) saw gains, while Oil and Gas (-0.4%) was the sole loser.

What’s trending

⭐ Andhra govt. okays Adani Green projects🔌

ADANIGREEN (NSE): 1,795 ▲ 58 (+3.3%)

The Andhra Pradesh government has approved Adani Green's proposal to build pump-storage projects in four districts. These projects will involve transporting water from one reservoir to another at different elevations to generate and store electricity. Adani Green will invest ₹15,740 crore in these projects, which will have a combined capacity of 3,700 megawatt.

⭐ Coal India to set up thermal power plant⚡

COALINDIA (NSE): 177 ▼ 2.0 (-1.1%)

Coal India subsidiary South Eastern Coalfields (SECL) has signed an MoU with the Madhya Pradesh Power Generation Company to develop a thermal power plant. SECL announced that a joint venture will be formed for a 660 megawatt power plant in the Amarkantak Thermal Power Station in Chachai, Madhya Pradesh. It will be set up at an investment of ₹4,665 crore.

⭐ Vi postpones AGR payment 💰

IDEA (BSE): 8.5 ▲ 0.02 (+0.2%)

Vodafone Idea has said it will postpone the payment of its adjusted gross revenue (AGR) dues of ₹8,837 crore by four years. The company will pay the amount in six equal instalments from 31 March 2026. In October 2021, the Department of Telecom (DoT) granted the company a four-year deferment on the dues. DoT said that the company can also give equity in exchange for the interest due.

⭐ Allsec and Quess Corp to merge 🤝

QUESS (NSE): 609 ▼ 9.8 (-1.5%), ALLSEC (NSE): 435 ▲ 4.7 (+1.0%)

Business process outsourcing company Allsec Technologies will merge with technology-enabled staffing and outsourcing services provider Quess Corp. As part of the deal, Allsec shareholders will get 74 shares of Quess, for every 100 shares held in Allsec. The merger aims to simplify the corporate structure and achieve sales and operational efficiencies.

⭐ US Fed hints at recession 😱

US Federal Reserve chairman Jerome Powell acknowledged that frequent interest-rate hikes could possibly lead the US economy into recession. Last week, the Fed announced a 0.75% hike, taking the interest rate to 1.75%. The move is to combat increasing inflation, which is at a 40-year high.

In Focus

DIIs to the rescue

Domestic institutional investors (DIIs), including mutual funds, insurance companies and pension funds, have invested nearly ₹2.16 lakh crore in the equity market so far in 2022. As per the Finance Minister, Nirmala Sitharaman, investments by retail investors through different modes have acted as shock-absorbers for the Indian markets. Let’s see how.

The Nifty50 is down by over 12% this year mainly due to the selloff by foreign investors (FIIs), who pulled out nearly ₹2 lakh crore from the Indian markets. FIIs have been net sellers in emerging markets like India due to inflation and rising interest rates. However, DIIs, backed by retail investors, have helped cushion this impact. As per market experts, without the support of DIIs, Indian markets would have fallen much lower.  

Despite lower returns given by the Nifty50 this year, retail investors continued to pump money into the market either through mutual fund SIP or direct investments into the markets. The retail inflow has been strong because of rising awareness about the stock markets, significant increase in retail investor numbers during the pandemic and lower returns offered by other asset classes, like bank FD and other fixed-income securities.

Backed by this retail investor inflow, DIIs were net buyers and were optimistic about sectors like banking & financial services, pharma, healthcare and FMCG.

According to recent reports, the government now proposes to increase the equity allocation of Employees’ Provident Fund Organisation (EPFO) from 15 to 20%. If the proposal is accepted, it would mean more money flowing into equity markets as EPFO is one of the major domestic investors.

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Good to know

What are domestic institutional investors?

Domestic institutional investors (DIIs) are large investors that invest in securities in their home country. These include big organisations like mutual funds, banks and insurance companies. Just like foreign institutional investors, DIIs play a key role in the performance of stock markets, as they make large investments that can impact market movements.

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