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Nifty ends in negative terrain on Friday

18 Aug 2023 Evaluate

Indian equity benchmark -- Nifty -- ended Friday’s trading session on a lower note, dragged by IT stocks, amid concerns over the Chinese economy and higher U.S. interest rates. Index made a negative start, as market participants were cautious with private report stating that private equity and venture capital funds' investments in the country declined 5 per cent to $3.9 billion across 59 deals in July 2023. Traders overlooked the Reserve Bank of India's article stating that investment activity is gaining momentum and the envisaged capital expenditure is set to jump by over 80 per cent to Rs 1.71 lakh crore in the current fiscal (FY24). It also said improvement in capacity utilisation of the manufacturing sector, pick-up in credit demand and improving consumer sentiments are helping the capex cycle.

In afternoon session, index continued to trade on a lower note, as sentiments remained downbeat after the Reserve Bank of India's monthly bulletin said headline inflation is expected to average well above 6 per cent in the second quarter. It noted headline inflation, after reaching a low of 4.3 per cent in May 2023, rose in June and is expected to surge during July-August led by vegetable prices. Besides, another report stated that the Rs 1.3 lakh crore interest-free loans allotted to states for their capital expenditure needs are likely to remain underutilised by 20 percent in FY24. In last leg of trade, index trimmed most of its losses, but failed to hold recovery and ended with 0.28% losses.

Traders were seen piling up positions in Media, PSU Bank and Metal stocks, while selling was witnessed in IT, Reality and Healthcare Index. The top gainers from the F&O segment were Adani Enterprises, Adani Ports and Special Economic Zone and AU Small Finance Bank. On the other hand, the top losers were Manappuram Finance, Indiabulls Housing Finance and Birlasoft. In the index option segment, maximum OI continues to be seen in the 19400 - 19600 calls and 18900 - 19100 puts indicating this is the trading range expectation.

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