Post Session: Quick Review

Markets ended the last day of the Financial Year 2023 in green terrain as marketmen enthusiastically went for value buying amid lack of major negative developments regarding the banking industry mainly build the confidence among the investors. The bounce back came after sparking substantial volatility on Dalal Street in recent weeks. Indices managed to stage a smart performance in the session in line with strength in overnight US markets. Besides, traders hoping that Federal Reserve will provide some relief in rate hikes and might take pause after one more hike. Also, traders hoping the Fed will have to cut interest rates soon. Such cuts could offer huge relief after a year of relentless hikes to rates. On the domestic front, investors were keenly awaiting the Reserve Bank of India's (RBI) bimonthly monetary policy. All the sectoral indices on the BSE traded with gains right from the beginning. Among broader indices, Small cap index contributed major helped to the markets.

After making gap-up opening, markets hold their momentum, as concerns about turmoil in the banking sector continued to ease. Traders shifted their focus back to inflation and the outlook for interest rate hikes. Sentiments got a boost as the World Bank said India’s potential growth could benefit from accelerated implementation of an already ambitious reform agenda. Further, markets extended their upward rally in afternoon session. Traders continue to take support with Chief Economic Advisor (CEA) V Anantha Nageswaran expressing optimism over India’s economic growth and said that the country’s economy is likely to grow at the rate of 6.5 per cent in the coming decade on the back of the turnaround in financial and investment cycle. Indices continued their healthy buying till the end, as traders optimistic about upcoming key economic data.

On the global front, European markets were trading higher after data showed Eurozone inflation has fallen sharply from 8.5 percent to 6.9 percent to reach its lowest level for a year in March following a decline in energy costs. The region's jobless rate held steady at a record low of 6.6 percent in February, while German retail sales fell unexpectedly in February by 1.3 percent in real terms compared to the previous month, separate reports showed. Asian markets ended mostly in green with easing concerns about the global banking system as well as strong readings on Chinese manufacturing, services and construction activity helping boost investor sentiment.

The BSE Sensex ended at 58,991.52, up by 1031.43 points or 1.78% after trading in a range of 58,273.86 and 59,068.47. There were 26 stocks advancing against 4 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index gained 0.96%, while Small cap index was up by 1.35%. (Provisional)

The top gaining sectoral indices on the BSE were IT up by 2.52%, TECK up by 2.21%, Bankex up by 1.72%, Realty up by 1.64% and Energy was up by 1.61%, while there was no losing sectoral indices on the BSE (Provisional)

The top gainers on the Sensex were Reliance Industries up by 4.29%, Nestle up by 3.34%, Infosys up by 3.19%, ICICI Bank up by 3.08% and Tata Motors up by 2.80%. On the flip side, Sun Pharma down by 0.83%, Asian Paints down by 0.27%, Bajaj Finance down by 0.24% and Titan Company down by 0.07% were the top losers. (Provisional)

Meanwhile, Chief Economic Advisor (CEA) V Anantha Nageswaran expressed optimism over India’s economic growth and said that the country’s economy is likely to grow at the rate of 6.5 per cent in the coming decade on the back of the turnaround in financial and investment cycle. He further said going forward, global exports growth volumes may be somewhat tepid in terms of their growth rates due to the kind of uncertainties the world is facing. He said ‘So, I think the restoration of the financial, credit and the investment cycle in the commercial sector and the real estate sector will probably see us growing on an average of six and a half per cent in the coming decade’.

Nageswaran attributed the slowdown in India’s economic growth just before COVID-19 pandemic to the classic financial cycle distress that India went through. He opined ‘If you look at data from 2012 onwards, so basically pre-pandemic period itself, we went through a period of classic financial cycle repair, credit cycle repair, which is what brought down a slowdown in the construction sector, and real estate sector’. According to him, in the second decade of the century, by the time India could start thinking of enjoying the repaired balance sheets, came the pandemic for two years. He said ‘And then came the commodity price shock and later came the interest rate shock in the second half of the 2022’, and added that so naturally, some of these things do induce uncertainty in the minds of private investors and they may be a little bit more cautious than they might have been.

Noting that developing countries including India, definitely need economic growth to finance their energy transition requirements, Nageswaran said without domestic savings, there is no question of adequacy of resources for financing energy transition. On production-linked incentive (PLI) scheme, the CEA said the exit clause is very important for any scheme. The government has announced PLI schemes for 14 sectors, including white goods, textiles and auto components. The objective of the PLI scheme is to make domestic manufacturing globally competitive, create global champions in manufacturing, boost exports and create jobs.

The CNX Nifty ended at 17,359.75, up by 279.05 points or 1.63% after trading in a range of 17,204.65 and 17,381.60. There were 43 stocks advancing against 7 stocks declining on the index. (Provisional)

The top gainers on Nifty were Reliance Industries up by 4.31%, Nestle up by 3.42%, Infosys up by 3.21%, ICICI Bank up by 3.08% and Tata Motors up by 2.83%. On the flip side, Apollo Hospital Ent. down by 1.19%, Sun Pharma down by 0.89%, Adani Ports down by 0.75%, Asian Paints down by 0.32% and Bajaj Finance down by 0.15% were the top losers. (Provisional)

European markets were trading higher, UK’s FTSE 100 increased 13.49 points or 0.18% to 7,633.92, France’s CAC rose 35.24 points or 0.49% to 7,298.61 and Germany’s DAX was up by 55.48 points or 0.36% to 15,577.88.

Asian markets settled mostly higher on Friday amid strong gains in Wall Street shares overnight following receding fears of a global banking crisis, while US inflation data due later in the day is expected to provide additional clues on the US Federal Reserve's monetary policy path. Japanese shares gained on the back of a weaker yen, while strong readings on industrial output and retail sales for February also supported sentiments. Moreover, Chinese and Hong Kong shares gained on China's economic recovery optimism with official data showed that China's manufacturing activity expanded at a slower pace in March, while China’s services and construction activity also remained strong.