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Benchmarks end higher on Friday
Dec-27-2024

Indian equity benchmarks trimmed some of their intraday gains but managed to close higher on Friday on the back of sustained buying by domestic institutional investors. After opening with a positive note, markets moved up further in the early part of the session as traders took encouragement with Finance Ministry in its monthly review stating that India's economy is set to grow at around 6.5 per cent in FY25. The Finance Minister further said that the growth outlook for October to December appears bright, with rural demand remaining resilient and urban demand picking up in the first two months of the quarter. Some optimism also came with report that India's market capitalisation has soared 18.4 per cent to $5.18 trillion in 2024, adding $806 billion. This growth ranked third globally among the top 15 major markets, both in percentage and absolute terms. India will finish the year with the fifth biggest global market.

Sentiments remained firm in afternoon deals, as the commerce ministry in its 2024 year-end review stated that the Export Credit Guarantee Corporation of India (ECGC) is aiming to reduce the export credit gap through the Whole Turnover Export Credit Insurance for Banks (WT-ECIB) scheme, which is expected to benefit about 1,000 new small exporters, in addition to the existing 8,000-odd by facilitating the availability of adequate and affordable export finance from banks for working capital. However, markets trimmed some gains in late afternoon deals, as some concern came with the Global Trade Research Initiative (GTRI) stating that the depreciation of Indian rupee against the US dollar is expected to push the country's import bill by about $15 billion. Compared to December last year, the Indian Rupee (INR) has depreciated 2.34 per cent against the US dollar, moving from Rs 83.25 to Rs 85.20. However, strength in auto, Healthcare, and FMCG stocks kept the market in the green. 

On the global front, European markets were trading higher as trading resumed after a two-day break for Christmas holidays. Asian markets ended mixed on Friday, as traders continue to be optimistic about more interest rate cuts by the U.S. Fed next year. They also remain reluctant to make significant moves at the end of the holiday shortened week to start fresh next week. Back home, healthcare industry stocks were in watch with a private report that India’s healthcare sector is expected to reach $320 billion by 2028. The report added the pharmaceutical sector is targeting $130 billion by 2030 and biotechnology is aiming for $300 billion by the same year.

Finally, the BSE Sensex rose 226.59 points or 0.29% to 78,699.07, and the CNX Nifty was up by 63.20 points or 0.27% to 23,813.40.            

The BSE Sensex touched high and low of 79,043.15 and 78,598.55 respectively. There were 19 stocks advancing against 11 stocks declining on the index. 

The broader indices ended mixed; the BSE Mid cap index fell 0.08%, while Small cap index was up by 0.28%.

The top gaining sectoral indices on the BSE were Auto up by 0.86%, Healthcare up by 0.79%, FMCG up by 0.35%, Consumer Disc up by 0.33% and IT up by 0.22%, while Metal down by 1.19%, Oil & Gas down by 0.94%, PSU down by 0.93%, Power down by 0.82% and Energy down by 0.70% were the top losing indices on BSE.

The top gainers on the Sensex were Mahindra & Mahindra up by 2.47%, Indusind Bank up by 2.30%, Bajaj Finance up by 1.37%, Bajaj Finserv up by 1.32% and Tata Motors up by 1.32%. On the flip side, SBI down by 1.49%, Tata Steel down by 1.00%, Adani Ports &SEZ down by 0.88%, Zomato down by 0.75% and Ultratech Cement down by 0.72% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its report on Trend and Progress of Banking in India 2023-24 has said that the profitability of banks has maintained an upward momentum on the sixth consecutive year in 2023-24. It said that the profitability has continued even in the first half (H1) of financial year 2024-25, with the return of assets (RoA) at 1.4 per cent and return on equity (RoE) at 14.6 per cent.

It highlighted that robust credit growth led the expansion of the consolidated balance sheet of scheduled commercial banks (SCBs) during 2023-24. By definition, consolidated balance sheet is a financial statement of the bank which shows its liabilities, assets, equity, income, expenses and cash flows.

Further, it highlighted that the capital to risk weighted assets ratio (CRAR) of SCBs was 16.8 per cent at end-September 2024, with all bank groups meeting the regulatory minimum requirement and the common equity tier 1 (CET1) ratio requirement. The capital to risk weighted assets ratio (CRAR) is a indicator of financial stability of a bank. Besides, the asset quality of Banks has also improved, as per report, with the gross non-performing assets (GNPA) ratio falling to its lowest in 13 years at 2.7 per cent at March-end 2024 and 2.5 per cent at September-end 2024.

The combined balance sheet of urban co-operative banks (UCBs) expanded in 2023-24, with asset quality improving for the third consecutive year while capital buffers and profitability were strengthened. It mentioned while unsecured lending shrank and asset quality further improved, the non-banking financial companies (NBFC) sector saw double-digit credit growth. Moreover, it highlighted by the end of September 2024, the Gross Non-Performing Assets (GNPA) ratio had fallen to 3.4 per cent, and robust capital buffers had maintained the CRAR well above the required level.

The CNX Nifty traded in a range of 23,938.85 and 23,800.60. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy's Lab up by 2.72%, Indusind Bank up by 2.37%, Mahindra & Mahindra up by 2.23%, Tata Motors up by 1.78% and Eicher Motors up by 1.51%. On the flip side, Hindalco down by 1.73%, SBI down by 1.43%, Coal India down by 1.40%, ONGC down by 1.31% and Bharat Electronics down by 1.02% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 0.59 points or 0.01% to 8,137.58, France’s CAC rose 40.01 points or 0.55% to 7,322.70 and Germany’s DAX gained 66.18 points or 0.33% to 19,914.95.

Asian markets ended mixed on Friday, with Japanese markets leading regional gains on yen weakness following Bank of Japan Governor Kazuo Ueda’s comments Wednesday that avoided giving a clear signal on interest rates next month. Meanwhile, Seoul shares dropped after South Korea's Acting President faced an impeachment vote amid a political crisis sparked by the Constitutional Court's first hearing on President Yoon Suk Yeol's short-lived martial law. Chinese and Hong Kong markets closed on a muted note after data showed China's industrial profits dropped in November for a fourth straight month.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

3,400.14

2.06

0.06

Hang Seng

20,090.46

-7.83

-0.04

Jakarta Composite

7,036.57

-29.18

-0.41

KLSE Composite

1,628.14

14.44

0.89

Nikkei 225

40,281.16

713.10

1.77

Straits Times

3,771.63

10.18

0.27

KOSPI Composite

2,404.77

-24.90

-1.04

Taiwan Weighted

23,275.68

28.74

0.12
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