Post Session: Quick Review

Indian equity benchmarks ended flat on Friday, as investors remained cautious ahead of Reliance Industries’ quarterly results. After a cautious start, markets remained lackluster for the most part of the session, as foreign fund outflows dented domestic sentiments. National Stock Exchange's provisional data showed foreign institutional investors (FII) sold shares worth Rs 1,169.32 crore on April 20. Some cautiousness came in as retail inflation for farm labour and rural workers rose marginally to 7.01 percent and 6.94 percent, respectively, in March compared to February this year, mainly due to higher prices of certain food items.

In early noon deals, indices were at day’s low points, amid negative cues from other Asian markets. Some anxiety came after reports that GST evasion detection by tax officers almost doubled year-on-year to over Rs 1.01 lakh crore in the just concluded 2022-23 fiscal. Some concern also came as a report by Acuite Ratings stated that India's economic activity is expected to decline and witness a lower growth print in FY24 on the back of a buoyancy in the services sector, moderation in inflation and the consistency in public sector capital expenditure.

However, markets staged recovery in the last hour of trade, tacking positive European markets. Traders got relief with the Retirement fund body, Employees' Provident Fund Organisation’s (EPFO) latest data report showing that India created 1396185 new jobs in the month of February 2023 as against revised figure of 1299220 in January 2023. Meanwhile, ICRA in its latest report titled ‘Business Activity Monitor - An Index of High Frequency Economic Indicators’ has stated that India’s real GDP growth is likely to have risen to 4.9% YoY in Q4 FY2023 from the provisional 4.4% in Q3 FY2023, with the softening of commodity price pressures.

On the global front, European markets were trading mostly in green, as Euro area consumers were less pessimistic in April and the consumer sentiment index rose faster than expected to its highest level in over a year. The flash consumer confidence index rose to -17.5 from -19.1 in March. Asian markets settled mostly lower, as overall consumer prices in Japan were up 3.2 percent on year in March. That was in line with expectations and down from 3.2 percent in February. On a seasonally adjusted monthly basis, inflation rose 0.4 percent - exceeding expectations for a gain of 0.1 percent following the 0.6 percent decline in the previous month.

The BSE Sensex ended at 59655.06, up by 22.71 points or 0.04% after trading in a range of 59412.81 and 59781.36. There were 14 stocks advancing against 16 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index fell 0.36%, while Small cap index was down by 0.27%. (Provisional)

The top gaining sectoral indices on the BSE were FMCG up by 0.83%, IT up by 0.61%, Telecom up by 0.59%, TECK up by 0.49% and Healthcare up by 0.21%, while Realty down by 2.07%, Metal down by 1.03%, Auto down by 0.94%, Capital Goods down by 0.61% and Industrials down by 0.43% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were ITC up by 1.99%, TCS up by 1.82%, Wipro up by 1.42%, Asian Paints up by 1.27% and HCL Tech. up by 1.09%. On the flip side, Tech Mahindra down by 2.26%, Maruti Suzuki down by 1.86%, Tata Steel down by 1.71%, Ultratech Cement down by 1.66% and Bajaj Finserv down by 1.25% were the top losers. (Provisional)

Meanwhile, the rating agency ICRA in its latest report has said that India's quick service restaurant industry is likely to witness 20-25 per cent growth in the current financial year (FY24) on account of the demand uptick and increasing penetration driven by a rapid expansion of stores. It noted that over the long-term, revenue growth shall be supported by factors like rising QSR penetration levels, a shift from the unorganised to the organised segment with a preference for branded quick service restaurant (QSR) players, given the hygiene and convenience factors (delivery over dine-in), etc.

However, the report stated that downside risks to the estimates remain from the emergence of any further Covid waves or any material weakening in purchasing power due to a high inflationary interest-rate regime. ICRA estimates that the top five players in the domestic quick-service restaurant industry are likely to add approximately 2,300 stores between FY2023-FY2025 with an estimated capex at around Rs 5,800 crore (excluding refurbishment) for this period, twice that of the levels seen during the pre-Covid era.

According to the report, majority of capex is expected to be funded through internal accruals and cash on the books, having raised money through the pre-IPO /IPO route in the last two fiscals to support the planned capex in the near- to medium-term. India's dependence on imports for edible oils further exposes the players' margins to geo-political risks and forex fluctuations.

The CNX Nifty ended at 17624.05, down by 0.40 points after trading in a range of 17553.95 and 17663.20. There were 25 stocks advancing against 24 stocks declining, while 1 stock remained unchanged on the index. (Provisional)

The top gainers on Nifty were ITC up by 1.99%, TCS up by 1.81%, Britannia up by 1.68%, Wipro up by 1.43% and Asian Paints up by 1.35%. On the flip side, HDFC Life Insurance down by 3.20%, Tech Mahindra down by 2.26%, Adani Enterprises down by 2.17%, SBI Life Insurance down by 1.98% and Maruti Suzuki down by 1.79% were the top losers. (Provisional)

European markets were trading mostly in green; UK’s FTSE 100 increased 26.03 points or 0.33% to 7,928.64 and France’s CAC rose 18.39 points or 0.24% to 7,557.10, while Germany’s DAX lost 20.17 points or 0.13% to 15,775.80.

Asian markets settled mostly lower in cautious trading on Friday in fears of a possible recession in this year. Overnight fall in Wall Street shares in reaction to weak economic data and a mixed bag of earnings from US companies also weighed on market sentiments. Chinese and Hong Kong shares dropped after China's uneven economic recovery and increasing Sino-US tensions kept sentiments bearish. Moreover, Japanese shares declined ahead to next week's Bank of Japan policy meeting for directional cues. Meanwhile, Japan’s core inflation for March came in at 3.1%, unchanged from February, data showed.