Post Session: Quick Review

16 May 2022 Evaluate

Indian equity benchmarks ended higher on Monday. After a cautious start, markets gained traction in morning deals, as traders took encouragement with Commerce and Industry Minister Piyush Goyal’s statement that the comprehensive trade agreement between India and the UAE will help in creating huge job opportunities and boost growth of the domestic economy. The bilateral pact is expected to increase the bilateral trade in goods to over $100 billion and trade in services to over $15 billion within five years. Besides, the Reserve Bank of India has said that public sector banks reported over 51 per cent dip in the amount involved in frauds to Rs 40,295.25 crore during the financial year ended March 2022.

In afternoon deals, key indices witnessed volatility, as some cautiousness came with Reserve Bank of India (RBI) data showing that India’s forex reserves declined by $1.774 billion to $595.954 billion for the week ended May 6 on the back of a fall in the core currency assets. Gains got trimmed, as sounding a red alert on India's CPI inflation at an 8-year high print of 7.79% YoY in April, Acuite Ratings has said it may trigger quicker rate hikes. Adding some worries among market participants, a private report stated that cryptocurrencies can lead to 'dollarisation' of a part of the economy which would be against India's sovereign interest.

However, despite volatility, markets managed to end higher. Traders got relief as Retailers Association of India (RAI) in its latest survey stated that retail businesses across India grew 23 per cent in April 2022 in terms of sales as compared to pre-pandemic levels of the same month in 2019 with customers coming back to stores. Some support also came as data provided by the Centre for Monitoring Indian Economy (CMIE) showed that in one of the largest expansions in the labour market since the beginning of the pandemic, 8.8 million people joined the country's workforce in April.

On the global front, European markets were trading mostly in red as alarmingly weak economic data from China fanned global recession fears. Asian markets settled mostly higher, even after industrial output in China was down 2.9 percent on year in April, the National Bureau of Statistics said on Monday - missing expectations for an increase of 0.4 percent and down from 5.0 percent in March. The bureau also said that retail sales tumbled an annual 11.1 percent in April - again shy of forecasts for a decline of 6.1 percent after slipping 3.5 percent in the previous month.

The BSE Sensex ended at 52973.84, up by 180.22 points or 0.34% after trading in a range of 52632.48 and 53428.28. There were 18 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 1.51%, while Small cap index up by 1.15%. (Provisional)

The top gaining sectoral indices on the BSE were Telecom up by 2.85%, Realty up by 2.59%, Auto up by 2.20%, Utilities up by 2.17% and Power up by 2.10%, while IT down by 0.58%, TECK down by 0.45% and FMCG down by 0.24% were the only losing indices on BSE. (Provisional)

The top gainers on the Sensex were NTPC up by 2.95%, Bajaj Finance up by 2.37%, Maruti Suzuki up by 2.30%, SBI up by 2.27% and HDFC up by 1.96%. On the flip side, Ultratech Cement down by 3.01%, Asian Paints down by 2.15%, ITC down by 1.78%, TCS down by 1.08% and Dr. Reddy's Lab down by 1.02% were the top losers. (Provisional)

Meanwhile, underlining a number of steps being taken by the government to address the rising inflation, Principal Economic Advisor to Government of India Sanjeev Sanyal has said that India has broadly come out of the turbulence that occured due to the COVID-19 pandemic.

Sanyal said that a speed up in the economic recovery can be seen. On the economic recovery post-COVID-19 pandemic front, Sanyal also highlighted a number of steps taken by the government, saying that a lot of sectors, like tourism, which were shut down, are coming back.

Besides, Sanyal said ‘this year, according to IMF, our economy might see economic growth of 8.2 per cent, it is the fastest in the world and I would say that it means that broadly we are now out of the turbulence that occured due to the pandemic.’

Further, on the government's course of action, if the COVID-19 situation worsens in the country and the possibility of another nationwide lockdown, Sanyal said ‘We are always alert that if a new wave comes, we will have to do something.’

The CNX Nifty ended at 15842.30, up by 60.15 points or 0.38% after trading in a range of 15739.65 and 15977.95. There were 30 stocks advancing against 20 stocks declining on the index. (Provisional)

The top gainers on Nifty were Eicher Motors up by 7.62%, Apollo Hospital Ent. up by 3.92%, NTPC up by 2.84%, UPL up by 2.65% and Bajaj Finance up by 2.35%. On the flip side, Ultratech Cement down by 2.97%, Shree Cement down by 2.59%, Asian Paints down by 2.09%, ITC down by 1.74% and Grasim Industries down by 1.55% were the top losers. (Provisional)

European markets were trading mostly in red, France’s CAC decreased 8.77 points or 0.14% to 6,353.91 and Germany’s DAX was down by 20.65 points or 0.15% to 14,007.28. On the flip side, UK’s FTSE 100 was up by 10.29 points or 0.14% to 7,428.44.

Asian markets settled mostly higher on Monday tracking strong gains in Wall Street last Friday, despite concerns about elevated inflationary pressures and aggressive monetary policy tightening. Hong Kong shares rose after reports that Shanghai was relaxing some of its lockdown restrictions. Chinese central bank PBoC kept the interest rate of the one-year medium-term lending facility unchanged at 2.85%, while injecting 100 billion yuan of liquidity into the banking system via the MLF. PBOC also maintained the interest rate of the seven-day reverse repurchase agreement at 2.1% while injecting CNY10 billion of funds via the monetary tool, data showed. Further, Japanese shares gained as weaker yen offered some support to exporters. However, Chinese shares slipped after retail sales and industrial production data for April came in far worse than expected. Meanwhile, Malaysia, Indonesia and Singapore markets were closed for Vesak Day holiday.

Asian Indices

Last Trade           

Change in Points

Change in %

Shanghai Composite

3,073.75
-10.53
-0.34                 

Hang Seng

19,950.21
51.44
0.26                 

Jakarta Composite

--
-         

KLSE Composite

---

Nikkei 225

26,547.05
119.40
0.45                   

Straits Times

--
-             

KOSPI Composite

2,596.58
-7.66
-0.29                   

Taiwan Weighted

15,901.04
68.50
0.43    


© 2024 The Alchemists Ark Pvt. Ltd. All rights reserved. MoneyWorks4Me ® is a registered trademark of The Alchemists Ark Pvt.Ltd.