Post Session: Quick Review

Indian equity benchmarks ended lower on Friday. The start of the day was on a negative note, as the mood on the street remained cautious with the labour ministry’s statement that retail inflation for farm workers and rural labourers rise marginally to 3.92 per cent and 4.09 per cent in July, as compared to the previous month. The numbers in June had stood at 3.83 per cent and 4 per cent, respectively. Sentiments were fragile as US Federal Reserve could rein in vast stimulus measures this year, coupled with the rapid spread of the coronavirus Delta variant, signs of faltering Chinese economic growth, and the Taliban's takeover of Afghanistan.

Markets remained in red for the whole trading session and finally ended lower. Traders remained worried, after industry body FIEO said that bilateral trade with Afghanistan has been impacted and Indian exporters are concerned about their payments as banking services and remittances may face restrictions due to the ongoing situation in that country. Besides, industry bodies said that exclusion of pharma goods from the export promotion scheme RoDTEP will adversely impact the sector's competitiveness. The government announced rates of tax refunds under the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme for 8,555 products, such as marine goods, yarn and dairy items, to boost exports.

Traders overlooked rating agency ICRA’s report that India's Gross domestic product (GDP) growth is estimated to come at the deceptively high level of 20 percent and the gross value added (GVA) will register a growth of 17 percent for the April-June 2021 quarter (Q1FY22) but is far below the same in the pre-COVID times. The street also ignored report stating that Finance Minister Nirmala Sitharaman will launch an ambitious Ubharte Sitaare Fund for export-oriented firms and startups. The fund has been set up by Exim Bank and SIDBI.

On the global front, European markets were trading lower as retail sales data coming out of the UK showed that the road to economic recovery will not be an easy one. Asian markets ended mostly lower on Friday, after China maintained its benchmark loan prime rates, as widely expected, on Friday. The one-year loan prime rate was maintained at 3.85 percent and the five-year loan prime rate at 4.65 percent. The one-year and five-year loan prime rates were last lowered in April 2020. The one-year loan prime rate was cut by 20 basis points and five-year rate by 10 basis points in April 2020.

The BSE Sensex ended at 55329.32, down by 300.17 points or 0.54% after trading in a range of 55013.98 and 55543.16. There were 8 stocks advancing against 22 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 1.91%, while Small cap index down by 1.83%. (Provisional)

The only gaining sectoral index on the BSE was FMCG up by 2.23%, while Metal down by 6.90%, Basic Materials down by 3.88%, Realty down by 3.50%, PSU down by 2.81% and Industrials down by 2.32% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Hindustan Unilever up by 5.37%, Asian Paints up by 3.64%, Nestle up by 3.40%, Bajaj Finance up by 1.71% and HDFC up by 0.43%. On the flip side, Tata Steel down by 8.27%, SBI down by 3.07%, Dr. Reddy's Lab down by 2.81%, Sun Pharma down by 2.78% and Kotak Mahindra Bank down by 2.68% were the top losers. (Provisional)

Meanwhile, the Union Commerce and Industry Minister Piyush Goyal has said that the nation is working towards making a quantum jump in merchandise exports.  He said that this has been made possible, thanks to the structural changes initiated by the government under the leadership of Prime Minister Narendra Modi.

The Minister said that the merchandise export target of $400 billion for the year 2021-22 has been set, in line with the Prime Minister’s clarion call, “Local goes Global: Make in India for the World”. The Minister said this during a meeting with Export Promotion Councils (EPCs), Commodity Boards and Authorities and other stakeholders in Mumbai, to discuss measures to enhance and increase exports.

Piyush Goyal also exhorted all Export Promotion Councils to take immediate and effective steps to rise to the challenge of achieving the merchandise export target of $400 billion for 2021-22. Besides, the Minister announced that two separate divisions are being set up in the Commerce Ministry focused on the services sector, in order to attain the $1 trillion services exports target.

The CNX Nifty ended at 16450.50, down by 118.35 points or 0.71% after trading in a range of 16376.05 and 16509.55. There were 11 stocks advancing against 39 stocks declining on the index. (Provisional)

The top gainers on Nifty were Hindustan Unilever up by 5.36%, Britannia up by 4.71%, Asian Paints up by 3.71%, Nestle up by 3.49% and Bajaj Finance up by 1.79%. On the flip side, Tata Steel down by 8.32%, JSW Steel down by 7.17%, Hindalco down by 5.46%, UPL down by 4.45% and Tata Motors down by 3.49% were the top losers. (Provisional)

European markets were trading lower, UK’s FTSE 100 decreased 21.38 points or 0.3% to 7,037.48, France’s CAC decreased 28.89 points or 0.44% to 6,577.00 and Germany’s DAX was down by 93.39 points or 0.59% to 15,672.42.

Asian markets ended mostly lower on Friday, driven by lingering worries over the Delta coronavirus variant and prospects of an early stimulus tapering by the US Federal Reserve. Chinese shares ended lower due to heavy sell off in tech stocks as regulatory uncertainty surrounding the sector lingers. While the People's Bank of China (PBoC) left its benchmark lending rate unchanged as widely expected. China’s one-year loan prime rate (LPR) and five-year LPR were both left unchanged at 3.85% and 4.65%, respectively, on Friday. Japanese shares settled lower, dragged down by automakers and their related sectors after Toyota Motor said it would slash global production for September by 40 percent due to chip crisis.