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EQUITY
Post Session: Quick Review
Jan-06-2025

Indian equity benchmarks witnessed significant losses in Monday’s trading session as traders sold out their riskier stocks. The heavy selling was triggered by growing concerns over outbreak of Human Metapneumovirus (HMPV) in China. Positive India’s Services Purchasing Managers' Index (PMI) data also failed to cheer the markets sentiments. Nifty and Sensex settled below the psychological 23,650 and 78,000 levels respectively. The broader indices, the BSE Mid cap index and Small cap index also went through hefty losses during the day. 

Markets made slightly positive start and soon turned negative as traders were concerned after India’s foreign exchange reserves continue to decline, extending downhill journey for three months now. data from the Reserve Bank of India (RBI) showed, in the week that ended December 27, the country’s foreign exchange kitty declined by $4.112 billion to $640.279 billion. Traders overlooked SBI research on consumption expenditure survey stated that rural poverty has declined significantly to 4.86 per cent in the fiscal ending March 2024 from 25.7 per cent in 2011-12 mainly driven by government support programmes. Urban poverty too is estimated at 4.09 per cent, down from 13.7 per cent in 2011-12. In afternoon session, indices added more losses even after HSBC India Services PMI, compiled by S&P Global, said India’s Services Purchasing Managers' Index (PMI) for December 2024 rose to 59.3 points, an increase from 58.4 points recorded in November, signalling growth in the country’s services sector. Adding more worries among market participants, a private report stated that India's current account deficit (CAD) is expected to remain elevated in FY26 due to stringent global trade policies. The report highlighted that the country's imports have consistently outpaced exports, leading to a widening trade deficit. The risk of a further deterioration in India's trade balance due to sluggish exports, which will keep the country's current account deficit (CAD) elevated. Markets continued their downward trade in late afternoon session as traders avoided to take risk ahead of Q3 earnings season, beginning with TCS this week.

On the global front, European markets were trading mostly in green ahead of key U.S. and European economic data due later in the week. Asian markets settled mostly down on Monday amid court dismissed an appeal by lawyers of Yoon Suk Yeol against an arrest warrant for the impeached president. Back home, Commerce and Industry Minister Piyush Goyal has said that foreign direct investment (FDI) inflows into the country are surging, with investors from the Middle East, Japan, European Union, and the US recognising India's status as a top investment destination, driving rapid economic growth and generating millions of new jobs. 

The BSE Sensex ended at 77,964.99, down by 1258.12 points or 1.59% after trading in a range of 77,781.62 and 79,532.67. There were 3 stocks advancing against 27 stocks declining on the index. (Provisional) 

The broader indices ended in red; the BSE Mid cap index was down by 2.44%, while Small cap index down by 3.17%. (Provisional)

The top losing sectoral indices on the BSE were Utilities down by 4.16%, Power down by 3.73%, PSU down by 3.56%, Oil & Gas down by 3.15% and Metal was down by 3.15%, while there were no gaining sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were Titan Company up by 0.60%, HCL Tech up by 0.26% and Sun Pharma up by 0.01%. On the flip side, ITC down by 8.20%, Tata Steel down by 4.41%, NTPC down by 3.65%, Kotak Mahindra Bank down by 3.26% and Power Grid down by 3.19% were the top losers. (Provisional)

Meanwhile, India’s services sector witnessed a faster growth in the month of December, as demand buoyancy continued to drive new business inflows higher, which in turn supported output growth and prompted firms to recruit additional workers.

According to the survey report, the seasonally adjusted HSBC India Services PMI Business Activity Index surged to 59.3 in December from 58.4 in November. Further, the HSBC India Composite PMI Output Index -- which measures both manufacturing and services -- also grew to 59.2 in December as against 58.6 in November. 

The report noted that buoyant underlying demand was identified by companies as the primary factor behind output growth. Not only did new orders increase for the forty-first month in a row, but also to the greatest extent since August 2024. On the price front, there was a softer increase in cost burdens, while selling price inflation likewise eased in December. 

Further, service providers remained confident that output would increase over the course of the coming 12 months. The overall level of positive sentiment fell from November's six-month high, but remained above its long-run average. Expanded capacities, new customer enquiries and budget allocation towards marketing were some of the tailwinds cited by firms.

The CNX Nifty is currently trading at 23616.05, down by 388.70 points or 1.62% after trading in a range of 23551.90 and 24089.95. There were 4 stocks advancing against 46 stocks declining on the index. (Provisional)

The top gainers on Nifty were Apollo Hospital up by 1.79%, Tata Consumer up by 0.79%, Titan Company up by 0.54% and HCL Tech up by 0.33%. On the flip side, ITC down by 8.09%, Tata Steel down by 4.47%, Trent down by 4.23%, BPCL down by 3.90% and Coal India down by 3.79% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC rose 30.23 points or 0.42% to 7,312.45 and Germany’s DAX was up by 61.27 points or 0.31% to 19,967.35. On the flip side, UK’s FTSE 100 was down by 16.09 points or 0.2% to 8,207.89.

Asian markets settled mostly down on Monday ahead of the release of minutes from the US Fed's last meeting due on Wednesday and the US December payrolls report due on Friday, with Japanese markets led declines due to profit taking after the Nikkei index's year-end rally. Chinese and Hong Kong shares dropped, even after a private sector survey showed China's service activity expanded at a faster clip at the end of 2024. While the Chinese onshore yuan breached a key milestone for the first time since late 2023 amid reports that the PBoC will issue the largest-ever offshore yuan bonds in Hong Kong this month. However, Seoul shares gained after a court dismissed an appeal by lawyers of Yoon Suk Yeol against an arrest warrant for the impeached president.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

3,206.92

-4.51

-0.14

Hang Seng

19,688.29

-71.98

-0.37

Jakarta Composite

7,080.47

-83.96

-1.19

KLSE Composite

1,625.47

-3.99

-0.24

Nikkei 225

39,307.05

-587.49

-1.49

Straits Times

3,821.84

20.01

0.52

KOSPI Composite

2,488.64

46.72

1.88

Taiwan Weighted

23,547.71

639.41

2.72
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