Post Session: Quick Review

Indian equity benchmarks concluded Tuesday’s session in green. Investors were braced for core sector growth and Gross Domestic Product (GDP) data, scheduled to be released on August 31. Sustained buying in IT and metal stocks offered some support to markets during the day. However, gains were restricted throughout the day, as traders preferred to play safe amid reports of Fed may hike interest rate again. As for broader indices, broader indices, the BSE Mid cap index and Small cap index ended with decent gains.

Markets made optimistic start and remained in green, as traders found support after India Ratings said with falling trade deficit, India's current account deficit is likely to narrow to around $10 billion or 1 per cent of GDP in the April-June quarter of the on-going fiscal. The country's current account deficit (CAD) stood at $18 billion or 2.1 per cent in the corresponding period of the previous fiscal. Markets maintained their gains in afternoon session, as sentiments remained positive after Credit rating agency, India Ratings and Research (Ind-Ra) in its latest report stated that the corporate rating upgrades continue to outpace the downgrades in July 2023, as it upgraded 20 ratings in July 2023 (June 2023: 29) while downgrading 10 ratings (June 2023: 9). As per the report, the upgrades were mainly in the realty, power and auto & auto components sectors in the reported month. In last leg of trade, indices trimmed most of their gains to trade flat but managed to keep their head in green. 

On the global front, European markets were trading higher as mining stocks led gains tracking strength in metal prices and NN Group jumped after reporting first-half results. All Asian markets ended higher as traders welcomed China's announcement of a slew of measures over the weekend to bolster the country's equity market as well as fuel an increase in spending and drive economic growth. Back home, Icra Ratings said that India IT services sector's revenue growth will slow down to 3 per cent in the current fiscal from 9.2 per cent in the previous financial year. The profitability will also take a beating in this financial year and the operating profit margin will narrow by up to 1 percentage point to 20-21 per cent.

The BSE Sensex ended at 65,075.82, up by 79.22 points or 0.12% after trading in a range of 64,956.67 and 65,229.03. There were 22 stocks advancing against 9 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index gained 0.45%, while Small cap index was up by 0.69%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 1.61%, Utilities up by 1.15%, Metal up by 1.12%, Power up by 1.10% and Capital Goods was up by 0.78%, while Telecom down by 0.67%, FMCG down by 0.31%, Healthcare down by 0.16% and Bankex was down by 0.10% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were JIO Financial up by 4.72%, Tata Steel up by 1.66%, Tech Mahindra up by 1.60%, NTPC up by 1.21% and JSW Steel up by 1.15%. On the flip side, Bharti Airtel down by 1.75%, Hindustan Unilever down by 1.06%, Axis Bank down by 0.96%, Reliance Industries down by 0.91% and Sun Pharma down by 0.45% were the top losers. (Provisional)

Meanwhile, expressing optimism over India’s current account deficit (CAD) situation, India Ratings has said that the country’s CAD is likely to narrow to around $10 billion or 1 per cent of Gross Domestic Product (GDP) in April-June quarter (Q1) of the current fiscal year (FY24), with falling trade deficit. The country's CAD stood at $18 billion or 2.1 per cent in the corresponding period of the previous fiscal. 

However, it expects CAD to rise in the second quarter of the current fiscal as it sees merchandise exports declining below $100 billion after a gap of eight quarters. Imports are expected to be around $163 billion during the period, up from a seven-quarter low of $160.3 billion witnessed in Q1 FY24, due to increase in crude prices since July. This will have the overall trade deficit printing in at a three-quarter high of $64 billion. 

Another reason is the moderation in services demand since June due to the slowdown in the global economy. Global services PMI stood at a five-month low of 52.7 in July. Thus, it said services trade surplus to remain around $36 billion in Q2. Merchandise exports contracted even in Q1 by coming in 14.1 per cent lower than the year-ago period. This was the biggest decline in the last 12 quarters. Goods exports stood at a seven-quarter low of $104 billion in Q1 FY24.

Merchandise imports came down to a seven-quarter low of $160.3 billion in Q1, while goods imports shrunk 12.7 per cent in the same period, which was the sharpest fall since Q2 FY21. Benign commodity prices helped in reducing the country's import bill as the inbound shipments of critical commodities such as crude (18.5 per cent) coal (32.4 per cent), organic chemicals (31.9 per cent) and vegetable oils (32.9 per cent) came down in value terms.

The CNX Nifty ended at 19,342.65, up by 36.60 points or 0.19% after trading in a range of 19,309.10 and 19,377.90. There were 39 stocks advancing against 12 stocks declining on the index. (Provisional)

The top gainers on Nifty were JIO Financial up by 4.31%, Hindalco up by 2.18%, UPL up by 2.13%, Adani Ports up by 1.99% and Hero MotoCorp up by 1.92%. On the flip side, Bharti Airtel down by 1.74%, Hindustan Unilever down by 1.16%, Reliance Industries down by 0.96%, Axis Bank down by 0.96% and Dr. Reddy's Lab down by 0.90% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 116.74 points or 1.57% to 7,455.32, France’s CAC rose 32.08 points or 0.44% to 7,356.79 and Germany’s DAX was up by 79.95 points or 0.5% to 15,872.56.

Asian markets ended higher on Tuesday, following positive cues from global markets, as China announced a slew of measures to boost the sagging economy. Chinese market climbed on expectations that policymakers will unveil more supportive measures to support the sputtering economy. Japanese shares ended higher amid the yen continued to weaken in quiet trade. Investors shrugged off data showing that Japan's unemployment rate rose for the first time in four months in July. The unemployment rate in Japan came in at a seasonally adjusted 2.7 percent in July, the Ministry of Internal Affairs and Communications said. That exceeded expectations for 2.5 percent, which would have been unchanged from the June reading. Meanwhile, Markets looked ahead to a raft of key economic readings from the U.S. and China this week for additional clues on the rate and economic outlook.