Post Session: Quick Review

Indian equity markets ended in a positive terrain with minor gains on Friday, amid easing global trade tensions and sustained foreign fund inflows. After a cautious start, markets quickly gained momentum and traded higher, as traders took some support with India Ratings and Research (Ind-Ra) has said that India Meteorological Department’s (IMD) prediction of slightly above-than-normal monsoon in 2025. However, markets came off from day’s high and traded closer to the neutral line.  

Some of the important factors in trade:

GST collections hit record high in April: Traders took support with the government data showing that the Gross Goods and Services Tax (GST) collection increased by 12 per cent in April, reaching to an all-time high of Rs 2.37 lakh crore. 

India's total exports jump to record $825 billion in FY25: Some support also came as the commerce ministry's data showed that India's exports of goods and services hit an all-time high of $825 billion in 2024-25

India's manufacturing sector growth improves to 58.2 in April: HSBC India Manufacturing Purchasing Managers’ Index (PMI) rose from 58.1 in March to 58.2 in April, indicating the strongest improvement in the health of the sector for ten months.

Global front: European markets were trading in green, while Asian markets ended in green, after China said it's evaluating the possibility of trade talks with the United States, raising hopes of trade war de-escalation.   

The BSE Sensex ended at 80501.99, up by 259.75 points or 0.32% after trading in a range of 80168.59 and 81177.93. There were 19 stocks advancing against 11 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.41%, while Small cap index down by 0.07%. (Provisional)

The top gaining sectoral indices on the BSE were Oil & Gas up by 0.69%, Energy up by 0.57%, IT up by 0.45% and Bankex up by 0.14%, while Telecom down by 2.06%, Consumer Durables down by 1.66%, Power down by 0.96%, Utilities down by 0.93% and Metal down by 0.62% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Adani Ports and Special Economic Zone up by 4.11%, Bajaj Finance up by 2.62%, SBI up by 1.51%, Indusind Bank up by 1.44% and Maruti Suzuki up by 1.21%. On the flip side, Nestle down by 2.28%, NTPC down by 1.61%, Titan Company down by 1.36%, Kotak Mahindra Bank down by 1.36% and Power Grid down by 1.11% were the top losers. (Provisional)

Meanwhile, a domestic rating agency -- Crisil Ratings has said that the Reserve Bank of India’s rate cuts will lead to an up to 0.20 per cent slip in return on assets (RoA), a key profitability indicator, for banks in FY26. It said the RoA will contract by 0.10-0.20 per cent to 1.1-1.2 per cent in FY26 from an over-two-decade high of 1.3 per cent in FY25. Compression in the net interest margin (NIM) by a similar level will be the key driver for the slip in RoA, the agency said, explaining that in a falling interest environment, interest rates on loans are expected to reduce faster than those on deposits.  

Apart from NIMs, the agency said, credit costs also have a bearing on the profitability front, and these costs have bottomed out after a secular decline for many years. Additionally, the other income and operating expenses are also seen as flat. Hence, compression in NIM will directly translate to moderation in RoA after accounting for the tax impact. It stated the extent of reduction in NIMs will, therefore, depend on the ability of banks to manage their deposit costs. But given the competition for deposits seen of late, that ability will be curtailed.

Its director Subha Sri Narayanan said ‘Of the loan assets, 45 per cent are linked to an external benchmark, primarily repo. Typically, these are repriced rapidly after rate cuts. On the other hand, any reduction in term deposit (TD) rates will apply only to incremental deposits and renewals, resulting in a slower transmission of the reduction to the liability side.’

The CNX Nifty ended at 24346.70, up by 12.50 points or 0.05% after trading in a range of 24238.50 and 24589.15. There were 17 stocks advancing against 32 stocks declining on the index. (Provisional)

The top gainers on Nifty were Adani Ports and Special Economic Zone up by 4.16%, Bajaj Finance up by 2.64%, Indusind Bank up by 1.74%, SBI up by 1.44% and Reliance Industries up by 1.24%. On the flip side, JSW Steel down by 5.50%, Bajaj Auto down by 2.41%, Eicher Motors down by 2.33%, Hero MotoCorp down by 2.27% and HDFC Life Insurance down by 2.14% were the top losers. (Provisional)

European markets were trading higher; Germany’s DAX gained 369.28 points or 1.61% to 22,866.26, France’s CAC rose 114.61 points or 1.49% to 7,708.48 and UK’s FTSE 100 increased 66.21 points or 0.77% to 8,563.01.

Asian markets ended higher on Friday after China said it's evaluating the possibility of trade talks with the United States, raising hopes of trade war de-escalation. Hong Kong's Hang Seng index rallied with tech and EV stocks leading the surge fueled by speculation of a U.S.-China trade deal. Japanese markets rose sharply, with exporters rising on a weaker yen after the Bank of Japan trimmed its growth and inflation forecasts. Shares in Taiwan rose, led by contract chipmaker Taiwan Semiconductor Manufacturing Co. (TSMC), after strong earnings from two major U.S. tech giants eased concerns about AI demand despite tariff disruptions under President Donald Trump. Chinese market remained closed for Labour Day.