Sensex, Nifty eke out marginal gains

A profit-booking at higher levels dragged Indian equity benchmarks to close the trading session near their neutral lines, as investors awaited cues from a slew of central bank meetings around the world. The Federal Reserve, the Bank of England and the Bank of Japan are holding their monetary policy meetings this week. Escalating Middle East tensions and China demand worries also rendered the underlying mood cautious. After a cautious start, markets witnessed volatility, amid foreign fund outflows. On July 29, foreign institutional investors (FIIs) sold shares worth Rs 2,474.54 crore. Some cautiousness came with a report that the government estimates its debt, including external borrowing, valued at current exchange rate and public account and other liabilities will increase to Rs 185 trillion, or 56.8 per cent of the GDP, during the current fiscal year. But, markets saw gaining rally in late morning deals and held it for the most part of the session, as economic think tank NCAER said the Indian economy could grow higher than 7 per cent and possibly closer to 7.5 per cent in the current fiscal on the back of normal monsoon and receded electoral uncertainty. 

Traders got support with Executive Director at the International Monetary Fund (IMF) Krishnamurthy Subramanian’s statement that reduction of corporate tax from 40 per cent to 35 per cent in the 2024 Indian Budget and removal of Angel Tax are among the measures that will promote India-US economic engagement. Some support also came as Union Labour Minister Mansukh Mandaviya reassured the public that there is no need for concern about job losses. He predicted that India's unemployment rate would fall below 3 per cent in the near future. Domestic sentiments remained optimistic in noon deals, as the Reserve Bank of India (RBI) in its latest report on Currency and Finance for the year 2023-24 showed that India is at the forefront of the digital revolution, leveraging on its digital public infrastructure, a vibrant financial technology (FinTech) ecosystem and a conducive policy environment to emerge as the fastest-growing digital economy in the world. However, a last hour correction dragged the markets to end flat.

On the global front, European markets were trading mostly in green, as the euro area economy logged a steady growth in the second quarter despite an unexpected contraction in Germany. Gross domestic product advanced 0.3 percent in the three months to June, which was similar to the first quarter growth.  Asian markets settled mostly down on Tuesday, after the unemployment rate in Japan came in at a seasonally adjusted 2.6 percent in June. That was beneath expectations for 2.6 percent, which would have been unchanged from the May reading. The jobs-to-applicant ratio was 1.23, shy of forecasts for 1.24 - which also would have been unchanged. Back home, power sector stocks remained in watch, as the Union Minister of State (MoS) for Power Shripad Naik has said that India's total installed power generation capacity has grown around 80 per cent over the last 10 years to 4,46,190 MW (4.46 GW) in June 2024. The installed capacity, which was 2,48,554 MW in March 2014, reached 4,46,190 MW in June.

Finally, the BSE Sensex rose 99.56 points or 0.12% to 81,455.40, and the CNX Nifty was up by 21.20 points or 0.09% points to 24,857.30.

The BSE Sensex touched high and low of 81,815.27 and 81,230.44 respectively. There were 16 stocks advancing against 14 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index surged 0.27%, while Small cap index was up by 0.88%.

The top gaining sectoral indices on the BSE were Utilities up by 1.97%, Power up by 1.49%, Consumer Durables up by 1.15%, Oil & Gas up by 0.73% and Consumer discretionary up by 0.72%, while FMCG down by 0.95%, Healthcare down by 0.27%, TECK down by 0.04% and IT down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 3.42%, NTPC up by 3.31%, Power Grid up by 2.12%, Bajaj Finserv up by 2.10% and Asian Paints up by 1.69%. On the flip side, Sun Pharma down by 1.30%, ITC down by 1.19%, Hindustan Unilever down by 0.90%, Bharti Airtel down by 0.68% and Ultratech Cement down by 0.61% were the top losers.

Meanwhile, Union Labour Minister Mansukh Mandaviya has said that there is no need for concern about job losses and there is no lack of jobs. Mandaviya stated that the country's unemployment rate would come down below 3 per cent in the future. 

He said the current unemployment rate is 3.2 per cent. It came down from 6 per cent in the 2017-18 period as employment generation has taken place under the Prime Minister Narendra Modi-led government.

He also said the labour force participation has gone up to 44 per cent from 38 per cent in 2017-18 while the work-population ratio rose to 40 per cent from 31 per cent during the same period.

The CNX Nifty traded in a range of 24,798.65 and 24,971.75. There were 22 stocks advancing against 28 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 3.37%, NTPC up by 3.31%, BPCL up by 3.05%, Power Grid Corp up by 2.18% and Asian Paints up by 1.70%. On the flip side, LTIMindtree down by 1.97%, Cipla down by 1.61%, SBI Life Insuran down by 1.47%, Grasim Industries down by 1.32% and Sun Pharma Inds. down by 1.26% were the top losers.

European markets were trading mostly in green; Germany’s DAX gained 80.78 points or 0.44% to 18,396.56, and France’s CAC gained 27.65 points or 0.37% to 7,471.49, while UK’s FTSE 100 fell 15.12 points or 0.18% to 8,277.23.

Asian markets settled mostly down on Tuesday ahead of slew of central bank policy meetings in Japan, the United States, and UK and mega-cap US tech earnings this week. Many investors were expecting no change in interest rates for July by US Federal reserve. Market sentiments weakened further as Germany reported that its economy contracted in the last quarter. Chinese and Hong Kong shares dropped ahead of Chinese factory activity data due this week. Although, Japanese shares gained after data showed Japan’s jobless rate dipped to 2.5% in June from 2.6% in the previous month, marking the first improvement in five months.