Post Session: Quick Review

Indian equity benchmarks ended volatile session in red on Wednesday. The start of the trading session was on cautious note, as foreign portfolio investors (FPIs) turned sellers of domestic stocks to the tune of Rs 4,502.25 crore on June 14, data available with NSE suggested. Some concerns also came after Crisil Ratings in a report said that non-banking financial companies are likely to witness close to Rs 18 lakh crore of their outstanding debt getting repriced at higher levels in FY23 amid the rising interest rate scenario. The agency expects borrowing cost of NBFCs (Non-Banking Financial Companies) to go up by 85-105 basis points (bps) in this fiscal owing to recent hikes in repo rate by 90 basis points in two tranches and an expected rise of another 75 bps in the remaining fiscal.

During the trading session, markets altered between green and red terrain again and again, after credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the sharp rise in the interest rate is likely to affect the volume in non-priority sector lending (PSL) securitisation in the near term, unlike that of PSL transactions, which are more driven by regulatory requirements. According to the report, the sharp rate rise of more than 1%-2% along with a challenging business environment may affect borrowers with floating interest rate loans such as home loans and loan-against-property (LAP), and especially borrowers having lesser financial flexibilities.

Finally, key indices ended near their intraday low points, as cautiousness prevailed in the markets after India's merchandise exports in May rose by 20.55 per cent to $38.94 billion, while the trade deficit ballooned to a record $24.29 billion. Imports during May 2022 grew by 62.83 per cent to $63.22 billion. Besides, highlighting the issue of public stockholding for food security at World Trade Organization (WTO) 12th Ministerial Conference (MC12), Union Minister of Commerce and Industry, Consumer Affairs, Food & Public Distribution and Textiles, Piyush Goyal  asked, 'What is holding back WTO, still no solution to public stockholding for food security.

On the global front, European markets were trading higher despite rising headwinds to growth. Asian markets ended mostly lower on Wednesday, after China industrial production logged a mild recovery in May and retail sales fell less than expected with the gradual relaxation of pandemic-related restrictions. According to the National Bureau of Statistics, industrial production rose 0.7 percent on a yearly basis in May, reversing the 2.9 percent fall in April. Production was forecast to drop 0.7 percent.

The BSE Sensex ended at 52541.39, down by 152.18 points or 0.29% after trading in a range of 52493.36 and 52867.73. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 0.52%, while Small cap index up by 0.49%. (Provisional)

The top gaining sectoral indices on the BSE were Auto up by 0.90%, Industrials up by 0.60%, Capital Goods up by 0.57%, Consumer Disc up by 0.57% and Healthcare up by 0.42%, while Power down by 0.91%, Energy down by 0.82%, Oil & Gas down by 0.81%, Utilities down by 0.79% and Metal down by 0.74% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finserv up by 4.24%, Bajaj Finance up by 2.04%, Larsen & Toubro up by 0.97%, SBI up by 0.83% and Asian Paints up by 0.76%. On the flip side, Tata Steel down by 3.67%, NTPC down by 2.02%, Infosys down by 1.29%, Reliance Industries down by 1.18% and Wipro down by 1.07% were the top losers. (Provisional)

Meanwhile, the commerce ministry in its latest data has said that India’s merchandise exports rose 20.55 per cent to $38.94 billion in May 2022 as compared to $32.30 billion in May 2021. Merchandise imports in May 2022 were $63.22 Billion, which is an increase of 62.83 per cent over imports of $38.83 Billion in May 2021. The trade deficit widened to $24.29 billion in May 2022 from $6.53 billion from the year-ago period.

As per the data, cumulative value of exports for the period April-May 2022 was $78.72 billion as against $63.05 billion during the period April-May 2021, registering a positive growth of 24.86%. Cumulative value of imports for the period April-May 2022 was $123.41 billion, as against $84.87 billion during the period April-May 2021, registering a positive growth of 45.42%. The trade deficit during the first two months of this fiscal widened to $44.69 billion against $21.82 billion in the year-ago period.

It further showed that Non-petroleum and non-gems & jewellery exports in May 2022 were $27.16 billion, registering a positive growth of 13.10 per cent over $24.02 billion in May 2021. Non-petroleum and non-gems & jewellery exports during April-May 2022 was $55.60 billion, an increase of 16.42 per cent over $47.76 billion in April-May 2021. Non-petroleum, non-gems & jewellery (gold, silver & precious metals) imports were $34.79 billion in May 2022 with a positive growth of 31.66 per cent over $26.42 billion in May 2021. Non-petroleum, non-gems & jewellery (gold, silver & precious metals) imports were $70.42 billion in April-May 2022, recording a positive growth of 32.94 per cent, as compared to $52.97 billion in April-May 2021.

The CNX Nifty ended at 15692.15, down by 39.95 points or 0.25% after trading in a range of 15678.90 and 15783.65. There were 24 stocks advancing against 26 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bajaj Finserv up by 4.17%, Tata Motors up by 2.21%, Bajaj Finance up by 2.03%, Hero MotoCorp up by 1.87% and Grasim Industries up by 1.71%. On the flip side, Tata Steel down by 3.67%, ONGC down by 2.92%, NTPC down by 2.15%, Wipro down by 1.30% and Infosys down by 1.27% were the top losers. (Provisional)

European markets were trading higher, UK’s FTSE 100 increased 81.12 points or 1.13% to 7,268.58, France’s CAC increased 80.17 points or 1.35% to 6,030.01 and Germany’s DAX was up by 186.87 points or 1.4% to 13,491.26.

Asian markets ended mostly lower on Wednesday ahead of the US Federal Reserve’s interest-rate decision later in the day. Investors have raised their bets that, to tackle inflation, the US Federal Reserve will raise interest rates aggressively by 75 basis points, which would be the largest US interest rate hike in 28 years. Japanese shares fell even though a survey showing an improvement in confidence among Japanese manufacturers. The selloff persisted even after the Bank of Japan ramped up its bond buying program and Japan's core machinery orders posting a surprise double-digit growth in April. Moreover, Seoul shares declined after reports that South Korea's unemployment rate ticked up 0.1 percentage point to 2.8% in May. However, Chinese and Hong Kong shares gained after a slew of data from China topped expectations. Data showed that Chinese factory activity rebounded slightly in May, retail sales fell less than expected in the month and fixed asset investment for the January to May period topped expectations due to relaxation in Covid-related restrictions.