Markets trade near day low levels in late afternoon session

Indian equity markets traded near day’s low levels in late afternoon session amid volatility. Traders were cautious after domestic rating agency Crisil said the banking system's credit growth will drop by 2 percentage points to 14 per cent in financial year 2024-25. The slowdown will be due to lower GDP growth at 6.8 per cent in FY25, as against 7.6 per cent in FY24, RBI measures like higher risk weights on unsecured loans and a high base. On the global front, European markets were trading mostly lower as investors awaited key inflation readings from the U.S. and Eurozone this week for directional cues. Meanwhile, an ECB survey showed that consumers lowered their inflation expectations last month.

The BSE Sensex is currently trading at 75241.16, down by 149.34 points or 0.20% after trading in a range of 75204.35 and 75585.40. There were 11 stocks advancing against 19 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in red; the BSE Mid cap index declined by 0.57%, while Small cap index was down by 0.96%.

The  few gaining sectoral indices on the BSE were Healthcare up by 0.30% and FMCG was  up by 0.08%, while Realty down by 1.93%, Power down by 1.67%, Utilities down by 1.40%, PSU down by 1.21% and Oil & Gas was down by 1.09% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 1.28%, Wipro up by 0.89%, JSW Steel up by 0.88%, Hindustan Unilever up by 0.65% and Mahindra & Mahindra up by 0.39%. On the flip side, Power Grid down by 1.45%, Tata Motors down by 1.02%, Tech Mahindra down by 0.95%, NTPC down by 0.88% and Bharti Airtel down by 0.78% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its latest data on ‘the financial performance of non-government non-financial (NGNF) foreign direct investment (FDI) companies in India’ has showed that the net profit of FDI companies in India, or multinational companies, rose 45.2 per cent during 2022-23. Private limited FDI companies recorded higher profit growth as compared with public limited FDI companies. Besides, the report noted that services sector recorded higher profit growth when compared to the manufacturing sector.

According to the report, nearly half of the sample companies received direct investment from Singapore, Mauritius, and the USA. Japan, Netherland and United Kingdom were other major FDI source countries. It noted that a major chunk of the sample companies belonged to manufacturing, and information and communication sectors. The post-pandemic recovery in activities of firms consolidated further during 2022-23 and net sales of the sample companies rose by 21.1 per cent on top of 28.6 per cent growth in the previous year.

On the expenditure front, the RBI said that strengthening of economic activity resulted in 20.7 per cent growth in raw material expenses during 2022-23, while the operating expenses also rose by 20.7 per cent over and above 31.3 per cent increase in the previous year. Besides, manufacturing and services sectors witnessed a similar trend. The share of research and development (0.09 per cent) and royalty payment (1.11 per cent) in total expenditure of selected companies have come down marginally over the last two years.

Meanwhile, this data released by the RBI is based on audited annual accounts of 2,272 companies, which reported in the Indian Accounting Standards (Ind-AS) format for three accounting years from 2020-21 to 2022-23. Their economic sector classification is based on their principal business activity reported in MGT-7 form of the Ministry of Corporate Affairs, Government of India, which is the primary source of these data.

The CNX Nifty is currently trading at 22896.50, down by 35.95 points or 0.16% after trading in a range of 22889.10 and 22998.55. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 3.17%, SBI Life up by 2.82%, HDFC Life Insurance up by 2.72%, Grasim Industries up by 2.07% and Hero MotoCorp up by 1.78%. On the flip side, Adani Ports & SEZ down by 2.20%, Power Grid down by 1.54%, Coal India down by 1.30%, BPCL down by 1.27% and Adani Enterprises down by 1.21% were the top losers.

European markets trading mostly lower; UK’s FTSE 100 decreased 8.53 points or 0.10% to 8,309.41, France’s CAC fell 22.33 points or 0.27% to 8,110.16. while, Germany’s DAX was up by 46.38 points or 0.25% to 18,822.40.

Asian markets were trading mixed; Hang Seng declined 6.19 points or 0.03% to 18,821.16, KOSPI dropped 0.14 points or 0.01% to 2,722.85, Nikkei 225 slipped 44.65 points or 0.11% to 38,855.37 and Shanghai Composite weakened 14.47 points or 0.47% to 3,109.57, while Jakarta Composite gained 77.21 points or 1.06% to 7,253.63, Straits Times rose 11.64 points or 0.35% to 3,330.09 and Taiwan Weighted added 54.64 points or 0.25% to 21,858.41.