Post Session: Quick Review

Monday turned out to be a lackluster day for Indian equity benchmarks, as bears pulled both Sensex and Nifty lower to end near their intraday low points. After a negative start, markets remained under pressure during the entire trading session, as the Reserve Bank of India (RBI) data showed that the country’s foreign exchange reserves fell $2.238 billion to $570.74 billion in the week ended August 12. Some cautiousness also came in as retail inflation for farm and rural workers increased to 6.60 per cent and 6.82 per cent, respectively, in July mainly due to higher prices of certain food items. In June retail inflation for farm and rural workers stood at 6.43 per cent and 6.76 per cent respectively.

Indices extended their losses in the second half of the trading session, as traders remained cautious with External Affairs Minister S Jaishankar’s statement that India faces a challenge to ensure that its economic interests are well protected and its consumers are shielded to the extent possible from the enormous jump in the oil prices in the wake of the Ukraine conflict. Sentiments remained pessimistic, amid reports that with the price situation remaining at 'unacceptably and uncomfortably' high level, members of the RBI's Monetary Policy Committee underlined the need for preventing upward drift of inflation and bringing it down to the target band, as per minutes of its recent policy meeting.

The street paid no heed towards a report stating that labour ministry has said that retirement fund body -- Employee Provident Fund Organization (EPFO) added 18.36 lakh new subscribers in June 2022, registering 43 per cent rise as compared to the year-ago period. EPFO had added 12.83 lakh net new subscribers in June 2021. Market participants also overlooked the finance ministry's monthly economic review stating that India is better placed on the growth-inflation-external balance triangle for 2022-23 than it was two months ago, on the back of government policy response and the RBI’s monetary policy actions.

On the global front, European markets were trading lower as fears of more aggressive interest rate hikes from the Federal Reserve and the European Central Bank returned to the fore. Asian markets settled mostly lower on Monday, after Malaysia's trade surplus rose less than expected in July, as exports and imports rose at a softer pace. The data from the statistical office showed that the trade balance logged a surplus of MYR 15.5 billion in July. The trade surplus grew 14.3 percent from the same month last year. Exports increased 38.0 percent yearly in July, after a 38.8 percent growth in June.

The BSE Sensex ended at 58773.87, down by 872.28 points or 1.46% after trading in a range of 58705.11 and 59402.50. There were 2 stocks advancing against 28 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 1.80%, while Small cap index down by 1.17%. (Provisional)

The top losing sectoral indices on the BSE were Metal down by 2.69%, Realty down by 2.47%, Basic Materials down by 2.44%, Consumer Disc down by 2.01% and Auto down by 1.92%, while there were no gaining sectoral indices on the BSE. (Provisional)

The only gainers on the Sensex were ITC up by 0.64% and Nestle up by 0.28%. On the flip side, Tata Steel down by 4.50%, Asian Paints down by 3.51%, Wipro down by 2.96%, Sun Pharma down by 2.90% and Larsen & Toubro down by 2.87% were the top losers. (Provisional)

Meanwhile, expressing need to accept good technology, research, innovation and successful practices from across the world and from within India, Union Minister for Road Transport and Highways, Nitin Gadkari has said that India has got huge potential in infrastructure. He noted that in Indian infrastructure, there is huge potential for road construction, river connectivity, solid and liquid waste management, parking plaza, irrigation, busports, ropeways and cable car projects.

Union Transport Minister further said that the future of Indian infrastructure sector is very bright. He further said ‘We should use alternative materials to reduce cost without compromising on quality. Time is the most important aspect in construction, it is the biggest asset.’ The Minister underlined the role of civil engineers and said it is very important for job creation and for growth.

Pitching his idea of using greener alternatives in road construction, Union Transport Minister said ‘You should find alternatives to cement and other raw materials. Glass fibre steel can be used in place of steel. If there is competition, cost will come down and become reasonable.’

The CNX Nifty ended at 17490.70, down by 267.75 points or 1.51% after trading in a range of 17467.35 and 17690.05. There were 5 stocks advancing against 45 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Products up by 0.89%, ITC up by 0.77%, Coal India up by 0.53%, Britannia up by 0.38% and Nestle up by 0.06%. On the flip side, Tata Steel down by 4.54%, Asian Paints down by 3.81%, Adani Ports & SEZ down by 3.62%, Tata Motors down by 3.48% and JSW Steel down by 3.25% were the top losers. (Provisional)

European markets were trading lower, UK’s FTSE 100 decreased 18.93 points or 0.25% to 7,531.44, France’s CAC decreased 116.98 points or 1.8% to 6,378.85 and Germany’s DAX was down by 197.78 points or 1.46% to 13,346.74. (Provisional)

Asian markets settled mostly lower on Monday tracking losses of US stocks on Friday amid uncertainty over the US Fed's rate-hiking path. Investors are awaited Federal Reserve Chair Jerome Powell's keynote address at the Kansas City Fed's two-day annual economic symposium this week for fresh clues on the economic and interest rate outlook. Meanwhile investors are also fretted about potential recession risks globally. However, Chinese shares gained as the country's central bank PBoC cut its key lending rates again to boost an economy battered by Covid-19 lockdowns and a property market crisis.