Sensex, Nifty remain lackluster during early noon deals

Indian equity benchmarks remained lackluster during early noon deals, amid negative cues from other Asian markets along with selling at TECK and IT counters. Traders were cautious, as the IMF has said that the recent remarks of Krishnamurthy Subramanian, Executive Director at the International Monetary Fund, about India's growth figures does not represent the views of the IMF and were in his role as India's representative at the global body.

However, losses were limited, as amid rising rural demand, the Reserve Bank of India (RBI) Governor Shaktikanta Das has said that the consumption is likely to support economic growth in 2024-25, adding that urban consumption stayed buoyant. He said the resilience in cement production, together with strong growth in steel consumption and production and import of capital goods, augur well for the investment cycle to gain further traction.

On the global front, Asian markets were trading mostly in red, as the average household spending in Japan was down 0.5 percent on year in February, standing at 279,868 yen. That beat expectations for a decline of 2.8 percent following the 6.3 percent slide in January. On a monthly basis, household spending rose 1.4 percent - again exceeding expectations for a gain of 0.5 percent after slumping 2.1 percent a month earlier.

Back home, real estate industry stocks were in watch after sales data for Q4 FY24. Macrotech Developers has reported 40% growth in pre-sales at Rs 4,230 crore in the fourth quarter of FY24, while Puravankara has reported sales value of Rs 1,947 crore in Q4FY24 as compared to Rs 1,007 crore in Q4FY23, i.e. reported 93% growth. For the full financial year, sales value stood at Rs 5,914 crore. 

The BSE Sensex is currently trading at 74157.33, down by 70.30 points or 0.09% after trading in a range of 73946.92 and 74287.02. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.43%, while Small cap index was up by 0.54%.

The top gaining sectoral indices on the BSE were Realty up by 1.67%, PSU up by 0.33%, Telecom up by 0.32%, FMCG up by 0.32% and Healthcare up by 0.31%, while TECK down by 0.53%, IT down by 0.52%, Capital Goods down by 0.33%, Auto down by 0.18% and Metal down by 0.11% were the top losing indices on BSE.

The top gainers on the Sensex were HDFC Bank up by 1.40%, Kotak Mahindra Bank up by 0.90%, Bajaj Finserv up by 0.77%, ITC up by 0.51% and Mahindra & Mahindra up by 0.42%. On the flip side, Larsen & Toubro down by 1.47%, Bajaj Finance down by 1.43%, Tech Mahindra down by 1.27%, Ultratech Cement down by 1.16% and Maruti Suzuki down by 1.05% were the top losers.

Meanwhile, the Reserve Bank of India’s (RBI’s) Monetary Policy Committee (MPC) has decided to Keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 6.50 per cent for the seventh consecutive time. Consequently, the standing deposit facility (SDF) rate remains unchanged at 6.25 per cent and the marginal standing facility (MSF) rate and the Bank Rate at 6.75 per cent. The MPC also decided to remain focused on withdrawal of accommodation to ensure that inflation progressively aligns to the target, while supporting growth. These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth. 

On the inflation front, the MPC highlighted that headline inflation softened to 5.1 per cent during January-February 2024, from 5.7 per cent in December. After correcting in January, food inflation edged up to 7.8 per cent in February primarily driven by vegetables, eggs, meat and fish. Fuel prices remained in deflation for the sixth consecutive month in February. CPI core (CPI excluding food and fuel) disinflation took it down to 3.4 per cent in February - this was one of the lowest in the current CPI series, with both goods and services components registering a fall in inflation. CPI inflation for 2024-25 is projected at 4.5 per cent with Q1 at 4.9 per cent; Q2 at 3.8 per cent; Q3 at 4.6 per cent; and Q4 at 4.5 per cent. 

On the economic growth front, the domestic economy is experiencing strong momentum. As per the second advance estimates (SAE), real gross domestic product (GDP) expanded at 7.6 per cent in 2023-24 on the back of buoyant domestic demand. Real GDP increased by 8.4 per cent in Q3, with strong investment activity and a lower drag from net external demand. On the supply side, gross value added recorded a growth of 6.9 per cent in 2023-24, driven by manufacturing and construction activity. Real GDP growth for 2024-25 is projected at 7.0 per cent with Q1 at 7.1 per cent; Q2 at 6.9 per cent; Q3 at 7.0 per cent; and Q4 at 7.0 per cent. 

The CNX Nifty is currently trading at 22495.60, down by 19.05 points or 0.08% after trading in a range of 22427.60 and 22517.10. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were HDFC Bank up by 1.44%, SBI Life Insurance up by 1.22%, Dr. Reddy's Lab up by 1.16%, Kotak Mahindra Bank up by 0.94% and Hero MotoCorp up by 0.82%. On the flip side, BPCL down by 1.65%, Bajaj Finance down by 1.44%, Larsen & Toubro down by 1.38%, Grasim Industries down by 1.36% and Hindalco down by 1.32% were the top losers.

Asian markets were trading mostly in red; Straits Times fell 19.78 points or 0.61% to 3,215.23, KOSPI dropped 27.79 points or 1.02% to 2,714.21 and Nikkei 225 slipped 781.06 points or 2% to 38,992.08, while Hang Seng advanced 4.33 points or 0.03% to 16,729.43 and Jakarta Composite gained 29.04 points or 0.4% to 7,283.44.