Benchmarks continue to trade lower in morning deals

Indian equity benchmarks continued to trade lower in morning deals, amid weak global market trends and fresh foreign fund outflows. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,073.28 crore on Friday, according to exchange data. Caution also prevailed in the market ahead of announcement of wholesale and retail inflation numbers for July later in the day. Some concern also came as the National Institute of Public Finance and Policy (NIPFP) in a mid-year macroeconomic review said that India’s economic growth is expected to slow down to 6 per cent in this financial year (FY24) from 7.2 per cent in FY23 due to headwinds in the global economy. Also, latest data by the Reserve Bank of India showed India’s foreign exchange reserve declined by $2.4 billion to $601 billion in the week ended July 4. On the global front, Asian markets are trading lower after mixed US economic data revived worries the Federal Reserve might hike interest rates again.

The BSE Sensex is currently trading at 64980.76, down by 341.89 points or 0.52% after trading in a range of 64821.88 and 65193.06. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 0.97%, while Small cap index was down by 0.74%.

The top losing sectoral indices on the BSE were Metal down by 1.86%, Realty down by 1.64%, Power down by 1.39%, PSU down by 1.22% and Telecom down by 1.14%.

The top gainers on the Sensex were Hindustan Unilever up by 0.63%, Nestle up by 0.62%, Sun Pharma up by 0.38%, Kotak Mahindra Bank up by 0.25% and Infosys up by 0.24%. On the flip side, JSW Steel down by 2.46%, SBI down by 2.09%, Tata Motors down by 2.08%, Bajaj Finserv down by 1.87% and Tata Steel down by 1.66% were the top losers.

Meanwhile, with poor showing by the manufacturing sector, India’s industrial production growth measured in terms of the Index of Industrial Production (IIP) declined to a three-month low of 3.7 per cent in June 2023. The factory output growth stood at 12.6 per cent in June 2022 on account of a lower base effect. The previous low of IIP was at 1.9 per cent in March 2023. Thereafter, it rose to 4.5 per cent in April and further to 5.3 per cent in May. For the month of June 2023, the Quick Estimates of IIP with base 2011-12 stood at 143.4. 

During the first quarter (April-June) of 2023-24, the IIP growth works out to be 4.5 per cent, down from 12.9 per cent in the corresponding period a year ago. The growth rates over corresponding period of previous year are to be interpreted considering the unusual circumstances on account of COVID 19 pandemic since March 2020.

As per the IIP data released by the National Statistical Office (NSO), the manufacturing sector’s output grew 3.1 per cent in June 2023 against a 12.9 per cent a year ago. Power generation rose 4.2 per cent in June 2023 compared to 16.4 per cent a year ago. Mining output rose by 7.6 per cent during the month under review against 7.8 per cent in the year-ago period. The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of June 2023 stood at 122.3, 141.0 and 205.2 respectively.

As per use-based classification, the capital goods segment grew 2.2 per cent in June this year compared to 28.6 per cent a year ago. Consumer durables output during the month declined by 6.9 per cent against a 25.2 per cent growth in the year-ago period. Consumer non-durable goods output increased by 1.2 per cent compared to a growth of 2.9 per cent a year earlier. Infrastructure/construction goods posted a growth of 11.3 per cent over a 9.4 per cent expansion in the same period a year ago. The data also showed that the output of primary goods logged 5.2 per cent growth in the month against 13.8 per cent in the year-ago period. The intermediate goods output in June rose 4.5 per cent compared to a 10.5 per cent growth during the corresponding month last year.

The CNX Nifty is currently trading at 19305.30, down by 123.00 points or 0.63% after trading in a range of 19257.90 and 19392.00. There were 8 stocks advancing against 42 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy's Lab up by 0.84%, Hindustan Unilever up by 0.63%, Nestle up by 0.40%, Sun Pharma up by 0.39% and ONGC up by 0.37%. On the flip side, Adani Enterprises down by 4.58%, Adani Ports &SEZ down by 2.80%, Eicher Motors down by 2.54%, JSW Steel down by 2.53% and Hindalco down by 2.52% were the top losers.

All Asian markets are trading lower; Taiwan Weighted lost 213.44 points or 1.29% to 16,387.81, Hang Seng declined 454.99 points or 2.39% to 18,620.20, Shanghai Composite weakened 29.71 points or 0.93% to 3,159.54, KOSPI dropped 21.95 points or 0.85% to 2,569.31, Jakarta Composite plunged 18.9 points or 0.28% to 6,861.08, Straits Times fell 60.56 points or 1.84% to 3,233.72 and Nikkei 225 slipped 410.93 points or 1.27% to 32,062.72.