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Benchmarks end at record closing high levels
Sep-12-2024

The bulls took charge towards the end of the day and lifted Indian equity benchmarks to record closing high levels, mirroring the bullish global trend. Indian markets began positively and consolidated during the first half, amid foreign fund inflows. As per NSE data, Foreign Institutional Investors (FII) were net buyers of Indian equities worth Rs 1,755 crore. Traders took support with Finance Minister Nirmala Sitharaman’s statement that the Union government is implementing various schemes to encourage the growth and development of MSME (Micro, Small and Medium Enterprises) sector across the country. She said these schemes include areas of credit support, formalization, technological assistance, infrastructure development, skill development and training and market assistance for the MSMEs. Some solace also came with the Union Minister of Petroleum and Natural Gas, Hardeep Singh Puri’s statement that India has a natural advantage in producing Green Hydrogen due to the low cost and abundance of solar energy and investments in the power grid. He added India is poised to lead the global green energy demand and the rising domestic demand across diverse sectors. 

Key indices witnessed a sudden jump during the last hour of the session and helped the indices to post a strong gain, fuelled by massive buying across sectors. Some optimism also came with a private report that private credit deployments are likely to surpass the $10 billion mark in 2024. The January-June period saw private credit transactions of over $6 billion in 96 deals, and the last two-and-a-half years have seen over $20 billion being deployed in the emerging alternative serving the credit needs of Indian companies. Meanwhile, investors are eyeing the release of India's Index of Industrial Production (IIP) for July and Consumer Price Index (CPI) or retail inflation data for August to be out later in the day. These data points will provide important cues for the market's trajectory, especially amid concerns about global economic headwinds.

On the global front, European markets were trading higher ahead of a European Central Bank policy meeting later in the day. The central bank is widely expected to cut its key interest rates by 25 basis points amid falling inflation and economic indicators signaling a weaker outlook. Asian markets settled mostly higher on Thursday as investors looked past high core U.S. inflation number and shift their focus to producer price inflation and weekly jobless claims data due later in the day for fresh hints regarding the size of future rate cuts by the Federal Reserve. 

Back home, on the sectoral front, shares of electric vehicle stocks were in limelight as the government approved PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme with an outlay of Rs 10,900 crore over a period of two years. The Scheme now includes e-vouchers, streamlining the EV buying process easier than ever.

Finally, the BSE Sensex rose 1439.55 points or 1.77% to 82,962.71, and the CNX Nifty was up by 470.45 points or 1.89% to 25,388.90.    

The BSE Sensex touched high and low of 83,116.19 and 81,534.29 respectively. There were 29 stocks advancing against 1 stock declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 1.32%, while Small cap index was up by 0.79%.

The top gaining sectoral indices on the BSE were Metal up by 3.05%, Telecom up by 2.61%, TECK up by 2.06%, Power up by 2.02% and Auto up by 1.99%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Bharti Airtel up by 4.36%, NTPC up by 3.87%, Mahindra & Mahindra up by 3.36%, JSW Steel up by 3.06% and Adani Ports &SEZ up by 2.94%. On the flip side, Nestle down by 0.09% was the lone loser.

Meanwhile, a survey conducted by industry body FICCI and Indian Banks’ Association (IBA) (FICCI-IBA) has suggested that the outlook for non-food industry credit growth over the next six months is optimistic with 62 per cent of the participating banks expecting non-food industry credit growth to be above 12 per cent. The nineteenth round of the FICCI-IBA survey was carried out for the period January to June 2024.

A total of 22 banks including public sector, private sector and foreign banks participated in the survey. These banks together represent about 67 per cent of the banking industry, as classified by asset size. The survey found the Indian economy and the banking sector remain robust and resilient. With improved balance sheets, banks are supporting economic activity through sustained credit expansion. However, credit growth is outpacing deposit growth, which could lead to liquidity challenges for the banking system.

The survey said raising deposits to keep pace with the loan growth and keeping the credit cost low remains on the top of banks’ agenda. The survey findings show that long-term credit demand has seen continued growth for sectors such as Infrastructure, metals, iron and steel, engineering. Infrastructure is witnessing an increase in credit flow with 77 per cent of the respondents indicating an increase in long-term loans. This could be attributable to the government’s capital expenditure push for the infrastructure sector.

The CNX Nifty traded in a range of 25,433.35 and 24,941.45. There were 49 stocks advancing against 1 stock declining on the index. 

The top gainers on Nifty were Hindalco up by 4.15%, Bharti Airtel up by 3.56%, NTPC up by 3.36%, Shriram Finance up by 3.36% and Grasim Industries up by 2.94%. On the flip side, Nestle down by 0.11% was the lone loser. 

European markets were trading higher; UK’s FTSE 100 increased 65.58 points or 0.8% to 8,259.52, France’s CAC rose 61.45 points or 0.83% to 7,458.28 and Germany’s DAX gained 217.78 points or 1.19% to 18,548.05.

Asian markets settled mostly higher on Thursday, tracking Wall Street’s gains overnight as a key US inflation report signalled slowing price growth and bolstered expectations of a 25-bps rate cut at next week's FOMC meeting. Japanese shares gained as a weak yen against the US dollar lifted semiconductor related shares and automakers. Meanwhile, Japan's soft producer price inflation data undermined hawkish signals from the Bank of Japan. South Korean shares jumped as chip and auto shares led the gain, while the country's top financial regulator said today it plans to lift the ban on short selling at the end of March. However, Chinese shares declined due to rising geopolitical tensions ahead of the November US presidential elections.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

2,717.12

-4.68

-0.17

Hang Seng

17,240.39

131.68

0.76

Jakarta Composite

7,798.15

37.19

0.48

KLSE Composite

1,638.31

-1.49

-0.09

Nikkei 225

36,833.27

1,213.50

3.29

Straits Times

3,556.53

25.36

0.71

KOSPI Composite

2,572.09

58.72

2.28

Taiwan Weighted

21,653.25

622.25

2.87
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