The domestic markets are likely to remain volatile despite global markets trading in relatively stable mode. Selling by FPIs is expected to cause the markets to wobble, though India’s macroeconomic figures remaine positive. The Infosys and HCL Technologies results were better than street expectations.

“In the new earnings season, the prime focus of the market will be the quarterly numbers. FIIs have offloaded equities worth over ₹13,334 crore in the first eight trading sessions of 2023,” said domestic brokerage Choice International.

IIP growth has surprised on the upside, accelerating to a five-month high of 7.1 per cent in November. The largest 4.7 percentage points contribution to growth came from the manufacturing sector, while mining and electricity accounted for 1.4 and 1 percentage point respectively. Retail inflation has eased more than expected in December, bringing the headline print below the RBI’s upper tolerance for the second straight month.

US stocks initially rallied, as inflation continues to ease, and as Fed members signal a lower tightening pace going forward.

“The dollar also headed lower as a subdued inflation report should let the Fed slow its hiking pace again,” said Edward Moya, Senior Market Analyst, The Americas OANDA.

“It became clear fairly quickly that stocks would not hold onto their initial gains as we will likely remain data-dependent going forward. ​The labour market is still hot and much of the relief we saw with energy prices appears to be going away this month,” he cautioned. ​

SGX Nifty at 17,947 signals a positive opening at 17,918.65. Asian stocks are mostly up in early deals on Friday, tracking US stocks, which closed on a strong note. However, Japan’s Nikkei is down.

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According to Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services Ltd, in the near term, investors will take cues from inflation data, as this will provide central banks direction for a rate hike.

“The IT sector, too, would remain in focus after Cyient reported better-than-expected results, while Infosys reported decent numbers. Management commentary and growth guidance would be key drivers for the sector. Momentum is likely to continue in metals, with copper prices surging to a six-month high, fuelled by China’s reopening and a weakening dollar,” he said.