India's stock market saw significant gains on Tuesday as positive local economic data countered the mixed signals emanating from international markets. Encouraging data showed India's retail inflation easing to a three-month low of 5.1% in January due to a slow increase in food price growth.
Furthermore, additional data revealed an unexpected acceleration in India's industrial production, which grew by 3.8% year-on-year in December, following a sharp decline in the previous month.
Investors remained cautious as global uncertainties persisted, with the US dollar and bond yields remaining steady. They anticipate the release of the US Consumer Price Index (CPI) data, which would likely indicate a further decrease in price pressures.
The US Labor Department's forthcoming CPI report is expected to show that annual inflation has fallen below 3% for the first time since 2021.
India's standard stock market index, the S&P BSE Sensex, closed the day up by 482.70 points or 0.68%, ending at 71,555.19. Simultaneously, the broader NSE Nifty index climbed up by 127.20 points or 0.59% to end at 21,743.25.
Financial institutions and banks saw widespread gains with HDFC Life, Axis Bank, and ICICI Bank reporting an increase of over 2%. Coal India's shares increased by 4.7% after a 17% surge in their Q3 consolidated net profit was reported.
However, not all news was rosy. A subsidiary of Hindalco, Novelis, reported an upward revision of expenses for its Bay Minette project by 65%, which, coupled with a one-year delay, led to a 12.5% dip in Hindalco's shares. Others like Grasim also experienced a decline, losing 3.7% in value. Divis Laboratories, UltraTech Cement, and BPCL saw a decrease of around 1% in their shares.
