Benchmarks end lower on Thursday; Nifty gives up 17,550 mark

Indian equity benchmarks ended lower on Thursday with Sensex and Nifty settling below 58,800 and 17,550 mark respectively, mainly dragged by telecom, realty and industrials stocks amid weak global cues. Markets made gap-down opening and traded under pressure throughout the day, as India's gross domestic product (GDP) rose 13.5% year-on-year (y-o-y) in the April-June period. Though, it is the fastest annual expansion in a year, it was lower than the predictions made by the Reserve Bank of India (RBI; 16.2 per cent) and other market participants. Traders were concerned as the data of the Department for Promotion of Industry and Internal Trade (DPIIT) showed that Foreign Direct Investment (FDI) equity inflows into India contracted by 6% to $16.59 billion during the April-June quarter this fiscal. However, markets recovered much of their initial losses in morning deals, taking support from Finance Secretary T V Somanathan’s statement that the government is confident that India’s real gross domestic product (GDP) growth will exceed 7 per cent in 2022-23 (FY23). This will make it the world’s fastest-growing major economy.

But, key gauges failed to hold recovery and fell sharply in late afternoon deals, as some pessimism remained among traders as report stated that India's manufacturing activity improved again in August, although S&P Global's Purchasing Managers' Index (PMI) edged down to 56.2 from the eight-month high of 56.4 recorded in July. Market participants  remained cautious as Moody’s Investors Service has lowered its gross domestic product (GDP) growth forecast for India to 7.7 percent for the calendar year 2022 (CY22). The global credit rating agency also lowered India's GDP forecast for CY23 to 5.2 percent from 5.4 percent. Adding more worries, the output of eight core infrastructure sectors contracted to six-month low of 4.5 per cent in July 2022 against 9.9 per cent in the year-ago period. The production growth of eight infrastructure sectors was 13.2 per cent in June 2022.

On the global front, European markets were trading lower amid worries that aggressive rate hikes by the Federal Reserve and other central banks in Europe and Asia will dent economic growth. Asian markets finished in red on Thursday as data showed the region's factory hubs saw further easing in demand in August. Hawkish comments from another Federal Reserve official on inflation and the pace of future rate rises also weighed on sentiment.

Finally, the BSE Sensex fell 770.48 points or 1.29% to 58,766.59 and the CNX Nifty was down by 216.50 points or 1.22% to 17,542.80.

The BSE Sensex touched high and low of 59,309.79 and 58,522.57, respectively. There were 7 stocks advancing against 23 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.57%, while Small cap index was up by 0.48%.

The top gaining sectoral indices on the BSE were Telecom up by 2.20%, Realty up by 1.07%, Industrials up by 0.90%, Capital Goods up by 0.70% and Consumer Discretionary up by 0.32%, while Energy down by 1.99%, Oil & Gas down by 1.77%, IT down by 1.68%, Metal down by 1.56% and TECK down by 1.41% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finserv up by 2.58%, Asian Paints up by 1.63%, Bharti Airtel up by 1.18%, Titan Company up by 0.78% and SBI up by 0.40%. On the flip side, Reliance Industries down by 2.99%, TCS down by 2.49%, Sun Pharma down by 2.42%, Tech Mahindra down by 2.15% and Hindustan Unilever down by 1.99% were the top losers.

Meanwhile, the Department for Promotion of Industry and Internal Trade (DPIIT) in its latest data has said that Foreign Direct Investment (FDI) equity inflows into India contracted by 6 per cent to $16.59 billion during the April-June quarter this fiscal. The inflows had stood at $17.56 billion during the corresponding period of the previous year.

It stated the total FDI inflows (which includes equity inflows, re-invested earnings and other capital) aggregated at $22.34 billion during the first three months of the current fiscal year as against $22.52 billion in the year-ago period. Further, it said Singapore emerged as the top investor during April-June period with $5.7 billion FDI. It was followed by Mauritius ($2.4 billion), UAE ($2.2 billion), USA ($1.5 billion), Netherland ($1 billion), and Japan ($851 million).

Moreover, it mentioned the computer software and hardware sector attracted the highest inflows of $3.5 billion during the three-month period of this fiscal. It was followed by services ($2.6 billion), trading ($2 billion), chemicals ($960 million), automobile industry ($691 million) and construction (infrastructure) activities ($680 million).

The CNX Nifty traded in a range of 17,695.60 and 17,468.45. There were 13 stocks advancing against 37 stocks declining on the index.

The top gainers on Nifty were Tata Consumer Product up by 3.87%, Bajaj Finserv up by 2.82%, Asian Paints up by 1.85%, Eicher Motors up by 1.64% and Hero MotoCorp up by 1.49%. On the flip side, Hindalco down by 3.64%, Reliance Industries down by 2.80%, ONGC down by 2.67%, TCS down by 2.34% and Sun Pharma down by 2.25% were the top losers.

European markets were trading lower; UK’s FTSE 100 decreased 107.53 points or 1.48% to 7,176.62, France’s CAC decreased 91.60 points or 1.5% to 6,033.50 and Germany’s DAX decreased 161.28 points or 1.26% to 12,673.68.

Most of the Asian markets finished in red on Thursday, as the hawkish interest rate outlook to tackle inflation spurred fears about global economic slowdown. Moreover, lingering war in Ukraine, foreign demand dwindling, peaking energy crisis and China's COVID curbs also dampened the investor sentiments. Japan’s Nikkei tumbled marking sharpest dip in a month with the bearish global indices and on woes over depreciation of local currency to a 24-year low level. Hang Seng settled lower for the fourth consecutive session. Shanghai also finished in red amid dismal Chinese manufacturing data, and as official PMI figures pointed to a further slowdown in the Chinese economy.