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Domestic indices trim losses in late morning deals
May-08-2024

Indian equity markets trimmed some of their losses in late morning deals as market participants got some support with government's chief economic adviser -- V. Anantha Nageswaran’s statement that India does not see any nasty upside to inflation at the moment, and expects its economy to expand by more than 7 per cent in the current fiscal year.  However, markets continued to trade in red on account of selling in Asian Paints, Hindustan Unilever, HDFC Bank, ICICI Bank and HCL companies’ stokes. Weak cues from the other Asian markets weighed on the domestic sentiments. Foreign fund outflows also dented sentiments. Foreign Institutional Investors (FIIs) sold shares worth Rs 3,668.84 crore on May 7. On the BSE sectoral front, traders were seen pilling up position in PSU, Oil & Gas, Energy, Telecom and Metal, while selling was witnessed in Bankex, Healthcare, IT, Consumer Durables and Auto. 

On the global front, Asian markets were trading mostly in red as traders largely refrained from making significant moves after hawkish comments from a few US Fed officials again raised concerns about the outlook for interest rates. Back home, in the stock specific development, Indraprastha Gas rose after the company reported a nine percent increase in its consolidated net profit to Rs 433.29 crore for the fourth quarter of fiscal year 2023-24 versus Rs 397.51 crore in the same period last year. 

The BSE Sensex is currently trading at 73325.39, down by 186.46 points or 0.25% after trading in a range of 73073.92 and 73420.91. There were 15 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.47%, while Small cap index up by 0.47%.

The top gaining sectoral indices on the BSE were PSU up by 1.78%, Oil & Gas up by 1.61%, Energy up by 1.52%, Telecom up by 1.02% and Metal up by 1.01%, while Bankex down by 0.47%, Healthcare down by 0.32%, IT down by 0.29%, Consumer Durables down by 0.23% and Auto down by 0.05% were the losing indices on BSE.

The top gainers on the Sensex were Power Grid up by 1.30%, NTPC up by 1.13%, Tata Steel up by 0.91%, SBI up by 0.88% and Reliance Industries up by 0.83%. On the flip side, Asian Paints down by 2.20%, Hindustan Unilever down by 1.85%, HDFC Bank down by 1.35%, ICICI Bank down by 1.32% and HCL down by 1.27% were the top losers.

Meanwhile, Federation of Automobile Dealers Association (FADA) has stated that the Indian auto retail sector recorded a robust 27% year-on-year (YoY) growth in April 2024, with the combined March-April period showing a 14% YoY increase. It noted that two-wheeler sales picked up 33% on-year, while three-wheeler sales increased 9% on-year.

Tractors also grew 1% YoY and commercial vehicles experienced a modest growth of 2% on year. The passenger vehicle (PV) segment achieved a 16% on-year growth. According to FADA, the outlook for May 2024 is shaped by several positive indicators. Improved vehicle supply and strategic planning in the 2W segment have led to rising customer bookings and better market sentiment, driven by favourable crop yields. In the PV segment, new model launches and favourable monsoon forecasts are set to stimulate customer interest, while bulk deals in the CV segment should bolster demand in sectors like iron ore, steel, and cement. The appeal of new electric models and sustained demand for conventional vehicles are likely to provide further momentum.

It further said despite these positive trends, challenges remain. Election uncertainty continues to affect market sentiment, delaying customer conversions and stalling purchasing decisions. Financial constraints, extreme temperatures, and overcapacity in the CV segment could slow growth, while heavy discounting in the PV segment could impact profitability. Seasonal factors such as no marriage dates and a lack of major festive events may also influence demand. The auto industry remains cautiously optimistic about its near-term outlook. Market opportunities exist with rising customer interest in new models. However, election-related uncertainty and financial constraints remain key challenges that the industry will need to monitor closely to navigate this evolving landscape effectively.

The CNX Nifty is currently trading at 22265.30, down by 37.20 points or 0.17% after trading in a range of 22185.20 and 22291.80. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were BPCL up by 2.42%, Coal India up by 2.03%, Power Grid up by 1.44%, NTPC up by 1.27% and ONGC up by 1.24%. On the flip side, Dr. Reddy's Lab down by 3.67%, Asian Paints down by 2.25%, Hindustan Unilever down by 1.86%, HCL down by 1.46% and ICICI Bank down by 1.31% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 107.42 points or 0.58% to 18,371.95, Nikkei 225 slipped 588.86 points or 1.54% to 38,246.24, Taiwan Weighted lost 2.43 points or 0.01% to 20,651.10, Straits Times fell 31.46 points or 0.96% to 3,268.58, Shanghai Composite weakened 11.71 points or 0.37% to 3,136.03 and Jakarta Composite plunged 25.83 points or 0.36% to 7,097.78. However, KOSPI increased 9.08 points or 0.33% to 2,743.44. 
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