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EQUITY
Post Session: Quick Review
Mar-26-2024

Indian equity markets ended Tuesday’s trade near day’s lowest levels with Nifty and Sensex settling below the psychological 22,050 and 72,500 levels respectively. Traders avoided to take position ahead of Monthly F&O expiry. Mixed cues from global markets also dampened the sentiments. The broader indices, the BSE Mid cap index ended with gains, while Small cap index ended in red. Selling was witnessed in IT and banking sectors’ stocks.

Bourses made gap down opening and extended their losses amid foreign fund outflows. Provisional data from the NSE showed that foreign institutional investors (FIIs) net sold shares worth Rs 3,309.76 crore on March 22. Sentiments were downbeat as the latest payroll data released by the Employee Provident Fund Organisation (EPFO) said the formal labour market in January experienced a slowdown as fewer fresh jobs were created during the month. In January 2024, the number of new monthly subscribers under the Employees’ Provident Fund (EPF) declined by nearly 4 per cent to 807,865 from 840,584 in December 2023. Markets continued to trade lower in afternoon session, as traders were cautious after Ministry of Finance has warned the ongoing crisis along the Red Sea shipping route poses a risk to 80 percent of India’s goods trade with Europe and could lead to higher inflation and lower growth in India due to rising transport costs. Investors overlooked report that S&P Global Ratings has raised India's Gross domestic product (GDP) growth forecast for the next financial year (FY25) to 6.8 per cent, but flagged restrictive interest rates as a dampener for economic growth. In November 2023, it had projected India's growth to be 6.4 per cent in FY25 on robust domestic momentum. It said the Indian economy is estimated to have clocked a growth of 7.6 per cent in the current fiscal (FY24).  In late afternoon trade, markets touched day’s low levels, as investors sold their riskier assets.

On the global front, European markets were trading mostly in green as traders looked ahead to the Easter break and the release of key European and U.S. inflation readings for directional cues. Asian markets ended mostly despite South Korea's consumer sentiment decreased in March from a 6-month high in February. The survey results from the Bank of Korea showed that the consumer confidence index dropped to 100.7 in March from 101.9 in the previous month. The consumer confidence survey was conducted between March 12 and 19 among 2,500 households. Back home, India has initiated an anti-dumping probe into the import of aluminium foil, used as a packaging material for conservation and preservation of edible and food products, from China following a complaint by domestic players.

The BSE Sensex ended at 72,470.30, down by 361.64 points or 0.50% after trading in a range of 72,363.03 and 72,705.29. There were 10 stocks advancing against 20 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index gained 0.71%, while Small cap index was down by 0.11%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 1.45%, Capital Goods up by 1.19%, Industrials up by 0.95%, Oil & Gas up by 0.84% and PSU was up by 0.62%, while TECK down by 0.83%, IT down by 0.57%, Bankex down by 0.51%, FMCG down by 0.29% and Telecom was down by 0.02% were th tope losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finance up by 2.26%, Larsen & Toubro up by 1.38%, NTPC up by 1.32%, Axis Bank up by 0.81% and Tata Motors up by 0.72%. On the flip side, Power Grid Corp down by 2.07%, Bharti Airtel down by 1.99%, Wipro down by 1.50%, Kotak Mahindra Bank down by 1.11% and HDFC Bank down by 1.11% were the top losers. (Provisional)

Meanwhile, S&P Global Ratings has raised India's Gross domestic product (GDP) growth forecast for the next financial year (FY25) to 6.8 per cent, but flagged restrictive interest rates as a dampener for economic growth. In November 2023, it had projected India's growth to be 6.4 per cent in FY25 on robust domestic momentum. It said the Indian economy is estimated to have clocked a growth of 7.6 per cent in the current fiscal (FY24).

S&P in its Economic Outlook for the Asia Pacific said ‘for Asian emerging market (EM) economies, we generally project robust growth, with India, Indonesia, the Philippines, and Vietnam in the lead.’  It said in largely domestic demand-led economies such as India, Japan, and Australia, the impact of higher interest rates and inflation on household spending power reduced sequential GDP growth in the second half. It noted that restrictive interest rates are likely to weigh on demand next fiscal year, while regulatory actions to tame unsecured lending will affect credit growth. It added that a lower fiscal deficit will also dampen growth. It said ‘even as we expect a mild slowdown in Asian EM economies, we generally see solid domestic demand growth and a pick-up in exports to drive robust growth, with India, Indonesia, the Philippines and Vietnam in the lead’.

The US-based agency further said high real policy rates will choke demand and are therefore likely to strengthen the case for lowering rates. It forecasts rate cuts of up to 75 basis points in India this fiscal. It said ‘in line with our projection for US policy rates, we largely expect these moves to occur in the second half of the year’. It noted that in India, slowing inflation, a smaller fiscal deficit and lower US policy rates will lay the ground for the Reserve Bank of India to start cutting rates. But it believed more clarity on the path of disinflation could push this decision at least to June 2024, if not later.

The CNX Nifty ended at 22,004.70, down by 92.05 points or 0.42% after trading in a range of 21,947.55 and 22,073.20. There were 20 stocks advancing against 30 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bajaj Finance up by 2.21%, Hindalco up by 1.99%, Britannia up by 1.98%, Adani Ports up by 1.76% and Larsen & Toubro up by 1.45%. On the flip side, Power Grid down by 2.07%, Eicher Motors down by 1.94%, Bharti Airtel down by 1.86%, Wipro down by 1.49% and Kotak Mahindra Bank down by 1.28% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC rose 2.87 points or 0.04% to 8,154.47 and Germany’s DAX was up by 46.69 points or 0.26% to 18,308.00. On the global front, UK’s FTSE 100 was down by 6.26 points or 0.08% to 7,911.31.

Asian markets settled mostly higher on Tuesday ahead of US personal consumption expenditure (PCE) inflation data and comments from central bank officials for additional clues on the interest rate outlook. Chinese shares gained after reports emerged that Chinese regulators are pushing banks to speed up approvals of new loans to cash-starved private property developers. Seoul shares buoyed as semiconductor shares surged. However, some gains were limited by rising geopolitical tensions and interest rate jitters persisted, while reports showing China has introduced new guidelines aimed at blocking Intel and AMD chips in government PCs and servers.

Asian Indices

Last Trade            

Change in Points

Change in %      

Shanghai Composite

3,031.48

5.17

0.17

Hang Seng

16,618.32

144.68

0.87

Jakarta Composite

7,365.66

-12.10

-0.16

KLSE Composite

1,538.42

0.88

0.06

Nikkei 225

40,398.03

-16.09

-0.04

Straits Times

3,233.33

35.23

1.09

KOSPI Composite

2,757.09

19.52

0.71

Taiwan Weighted

20,126.49

-65.76

-0.33
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