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Nifty witnesses selling pressure amid US recession anxiety

05 Aug 2024 Evaluate

Indian equity benchmark -- Nifty -- ended Monday’s trading session deep in red as traders reacted to weak U.S. monthly jobs data and recent weak data on US manufacturing activity that stocked fears the world's largest economy could slip into a recession after the US Fed seems to have waited too long to cut interest rates. Index made gap-down opening, amid foreign fund outflows. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 3,310 crore on Friday, according to exchange data. The mood on the street remained cautious as data from the central bank showed India's foreign exchange reserves halted a three-week gaining streak and stood at $667.39 billion as of July 26, coming off record highs. Meanwhile, investors across the globe are also observing the evolving situation in the Middle East. Tensions are escalating in the Middle East following the assassination of Hamas leader Ismail Haniyeh in Tehran allegedly by Israel.

In afternoon session, index continued to trade near day’s low point, as sentiments remained down beat after India’s services sector growth eased during the month of July as higher wage and material costs continued to push up business expenses, with the overall rate of inflation quickening from June. According to the survey report, the seasonally adjusted HSBC India Services PMI Business Activity Index eased to 60.3 in July from 60.5 in June. Further, the HSBC India Composite PMI Output Index -- which measures both manufacturing and services -- also fell to 60.7 in July as against 60.9 in June. Finally, index ended in red with losses of 662.10 point. 

All the sectorial indices ended in red. The top gainers from the F&O segment were Info Dr. Lal PathLabs, Marico and Hindustan Unilever. On the other hand, the top losers LIC Housing Finance, Samvardhana Motherson International and Tata Motors. In the index option segment, maximum OI continues to be seen in the 24900 - 25100 calls and 23900 - 24100 puts indicating this is the trading range expectation.

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