Markets off day’s high as India's services sector activity eases

Indian equity benchmarks came off from the day’s high points in early afternoon deals, as traders got cautious after India’s services sector witnessed deceleration in growth during the month of October, as rates of expansion softened, due to competitive conditions and price pressures. There were also faster increases in input costs and output charges during October, with rates of inflation outpacing their respective long-run averages. At the same time, a pick-up in inflation expectations dampened overall business sentiment. However, indices remained higher, on the back of positive cues from other Asian markets as weak U.S. labor market data added to bets that the U.S. central bank is done with the most aggressive tightening cycle in four decades. 
 
On the global front, Asian markets were trading higher, after China's service sector growth improved in October but the rate of expansion remained muted as new business logged the weakest rise in ten months and firms were more cautious about the economic outlook. The latest Purchasing managers' survey data from S&P Global showed that the headline Caixin services Purchasing Managers' Index posted 50.4 in October. The reading improved from September's nine-month low of 50.2. 

The BSE Sensex is currently trading at 64376.06, up by 295.16 points or 0.46% after trading in a range of 64350.73 and 64535.19. There were 19 stocks advancing against 11 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.69%, while Small cap index was up by 1.01%.

The top gaining sectoral indices on the BSE were Realty up by 2.14%, Consumer Durables up by 1.09%, Consumer Disc up by 0.99%, Oil & Gas up by 0.90% and Healthcare up by 0.85%, while there were no losing sectoral indices on the BSE.

The top gainers on the Sensex were Tata Motors up by 2.21%, Titan up by 1.74%, JSW Steel up by 1.51%, Tech Mahindra up by 1.20% and ICICI Bank up by 1.07%. On the flip side, Bajaj Finance down by 0.81%, Tata Steel down by 0.47%, Nestle down by 0.32%, Mahindra & Mahindra down by 0.25% and Bajaj Finserv down by 0.21% were the top losers.

Meanwhile, credit rating agency ICRA in its latest report has said that the overall air passenger traffic is likely to touch record highs of 373-380 million in FY2024, translating into a YoY growth of 14-16% over FY2023. This is higher than ICRA’s earlier estimate of 12-14%. Further, it said the upcoming festive and holiday season is likely to drive passenger growth over the next 4-5 months. Therefore, ICRA maintains a ‘Stable’ outlook on the Indian airport infrastructure sector.

According to the report, the top five airports (Delhi, Mumbai, Bengaluru, Hyderabad and Cochin), developed under the PPP (public private partnership) model, account for 50–55% of this passenger traffic. Aeronautical revenue of the major private airports recovered to around 85% of pre-Covid levels in FY2023 on the back of higher passenger and aircraft traffic and are likely to reach 107-110% of pre-Covid levels in FY2024. 

It further said that the recovery of aeronautical revenue is largely in line with broader trends in the passenger traffic recovery. On the other hand, recovery in non-aeronautical revenues is much stronger and is estimated to cross 120% of pre-Covid levels in FY2024, driven by a significant increase in lease rentals with large terminal areas getting added with the completion of expansion at the PPP airports.

The CNX Nifty is currently trading at 19248.95, up by 115.70 points or 0.60% after trading in a range of 19230.65 and 19276.25. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Apollo Hospital up by 5.09%, Adani Ports & SEZ up by 2.80%, Tata Motors up by 2.32%, Eicher Motors up by 2.12% and Titan up by 1.82%. On the flip side, Dr. Reddy's Lab down by 0.81%, Bajaj Finance down by 0.66%, SBI Life Insurance down by 0.53%, Tata Steel down by 0.38% and Nestle down by 0.26% were the top losers.

All Asian markets were trading higher; Hang Seng advanced 436.23 points or 2.47% to 17,666.82, Taiwan Weighted added 110.7 points or 0.67% to 16,507.65, Jakarta Composite gained 59.04 points or 0.87% to 6,810.43, Straits Times rose 63.85 points or 2.03% to 3,146.34, Shanghai Composite strengthened 21.01 points or 0.69% to 3,030.42 and KOSPI increased 25.22 points or 1.06% to 2,368.34.