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Domestic indices continue to trade with solid gains
Jul-26-2024

Domestic equity markets continued to trade with solid gains in late morning deals with frontline gauges rising above their crucial 24,600 (Nifty) and 80,600 (Sensex) levels. Hectic buying in Bharti Airtel, Tata Steel, Sun Pharma, JSW and Adani Ports companies’ stocks helped the markets to magnify their gains. Meanwhile, broader indices outperformed their large peers with BSE Mid cap index and Small cap index gaining in the range of 1.10-1.75%. Sentiments got boost as data showed a sharper than expected acceleration in U.S. economic growth in the second quarter. A report released by the Commerce Department showed real gross domestic product in the U.S. surged by 2.8% in the second quarter after jumping by 1.4% in the first quarter. The sentiments were further supported by Indian rupee appreciating 6 paise to 83.72 against the dollar at the Interbank Foreign Exchange on increased selling of the US currency by exporters and banks.

On the global front, Asian markets were trading mixed as traders assessed July inflation data out of Japan’s capital city of Tokyo, which is widely considered a leading indicator of nationwide trends. Tokyo’s headline inflation slowed slightly to 2.2% in July from 2.3% in May, while its core inflation rate - which strips out prices of fresh food - remained unchanged at 2.2%, in line with expectations. Back home, in the stock specific development, Ashok Leyland soared despite reporting a fall in Q1 profit.

The BSE Sensex is currently trading at 80661.86, up by 622.06 points or 0.78% after trading in a range of 80013.60 and 80744.77. There were 25 stocks advancing against 5 stocks declining on the index.

 The broader indices were trading in green; the BSE Mid cap index was up by 1.72%, while Small cap index up by 1.11%.

The top gaining sectoral indices on the BSE were Telecom up by 3.05%, Metal up by 2.89%, TECK up by 2.10%, Basic Materials up by 2.00% and Healthcare up by 1.96%, while there were no losers.

The top gainers on the Sensex were Bharti Airtel up by 3.19%, Tata Steel up by 2.92%, Sun Pharma up by 2.69%, JSW Steel up by 2.65% and Adani Ports up by 2.46%. On the flip side, Axis Bank down by 0.97%, Nestle down by 0.77%, HDFC Bank down by 0.73%, Hindustan Unilever down by 0.58% and Tech Mahindra down by 0.33% were the top losers.

Meanwhile, the Automotive Component Manufacturers Association of India (ACMA) has said that the turnover of India’s automotive component industry registered a growth of 9.8 per cent to Rs 6.14 lakh crore in the financial year 2023-24 (FY24). The industry had reported a turnover of Rs 5.59 lakh crore in the 2022-23 financial year. It stated that component supply to original equipment manufacturers (OEMs) in the domestic market grew by 8.9 per cent to Rs 5.18 lakh crore, with supply to the EV manufacturing industry accounting for 6 per cent of the total component production in the country.

ACMA said the aftermarket, estimated at Rs 93,886 crore, also witnessed a growth of 10 per cent in FY24. Apart from an increase in vehicle production, higher value addition from the component sector has led to growth in the auto components sector. Whilst overall merchandise exports from India witnessed degrowth in FY24, auto components exports have grown despite geopolitical challenges and there is an increase in logistics costs. That apart, growth in imports has been comparatively lesser, leading to a trade surplus, indicating thrust by the industry on front of localisation.

On the business outlook, it stated that steady growth in the vehicle industry has resulted in the industry reaching pre-pandemic levels of performance in FY24 in most segments. However, the first quarter of FY25 witnessed somewhat slower offtake in vehicle sales, especially in passenger vehicles and commercial vehicles, given the high base, due to inclement weather conditions and elections. With strong macro-economic indicators, conducive government policies and over 7 per cent growth projected for the Indian GDP, it is hopeful that the auto components industry will continue to perform well in FY25.

The CNX Nifty is currently trading at 24639.55, up by 233.45 points or 0.96% after trading in a range of 24410.90 and 24655.55. There were 43 stocks advancing against 7 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 3.65%, Apollo Hospital up by 3.35%, SBI Life up by 3.35%, Bharti Airtel up by 3.22% and Shriram Finance up by 3.06%. On the flip side, Tech Mahindra down by 1.26%, Axis Bank down by 1.07%, Nestle down by 0.89%, HDFC Bank down by 0.72% and ONGC down by 0.71% were the top losers.

Asian markets were trading mixed; Shanghai Composite weakened 4.37 points or 0.15% to 2,882.37, Straits Times fell 1.54 points or 0.04% to 3,428.91, Nikkei 225 slipped 107.82 points or 0.28% to 37,761.69 and Taiwan Weighted lost 800.22 points or 3.5% to 22,071.62. However, Hang Seng advanced 41.11 points or 0.24% to 17,046.08, Jakarta Composite gained 36.78 points or 0.51% to 7,277.06 and KOSPI increased 21.81 points or 0.8% to 2,732.46. 
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