Benchmarks settle on negative note on Friday

Indian equity benchmarks reversed yesterday’s gains and slipped over half a per cent on Friday dragged by Oil & Gas, Energy and PSU stocks. Markets made a negative start and extended their losses as the trading session progressed, as traders got anxious with provisional data from the NSE showing that foreign institutional investors (FIIs) net sold shares worth Rs 1,356.29 crore on March 14, 2024. Traders remained cautious with report by global rating agency Moody’s asserting that the large number scheduled elections in various countries in 2024 increases risks of shifts in policy and policy effectiveness. It argued while elections rarely immediately affect sovereign credit ratings, they can result in credit positive or negative developments - like changes in the policymaking process and legislative composition - which according to it ultimately alter a sovereign’s economic and fiscal trajectories.

Markets continued to show a sluggish trend in afternoon session after commerce ministry stated that India's merchandise trade deficit widened to $18.71 billion in February from $17.49 billion in January. The trade deficit stood at $16.57 billion in February 2023. While the trade deficit widened in February, exports rose by 11.9 percent to $41.40 billion, while imports increased by 12.2 percent on a year-on basis to $60.11 billion. However, markets managed to trim some losses in late afternoon deals, taking support from the Confederation of Indian Industry’s (CII) report that new unicorns are likely to add $1 trillion to the Indian economy, which would reach $7 trillion size by 2030, and add 50 million new jobs. Startup firms valued over $1 billion are categorised as unicorns. Meanwhile, the US embassy has said that in this first trilateral technology meeting, the United States, Republic of Korea, and India discussed opportunities to cooperate on semiconductor supply chains, telecommunications and digital public infrastructure, artificial intelligence, quantum, space, advanced materials, clean energy and critical minerals.

On the global front, European markets were trading higher as traders pared their expectations for a U.S. rate cut in June and braced for more hawkish signals from a Federal Reserve meeting next week. Asian markets settled mostly down on Friday with uncertainty around Fed easing, a lack of big-ticket stimulus from top metals consumer China and anxiety ahead of next week's Bank of Japan (BOJ) policy meeting weighing on sentiment.

Finally, the BSE Sensex fell 453.85 points or 0.62% to 72,643.43 and the CNX Nifty was down by 123.30 points or 0.56% to 22,023.35.

The BSE Sensex touched high and low of 72,998.07 and 72,484.82 respectively. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices ended mixed; the BSE Mid cap index fell 0.51%, while Small cap index was up by 0.25%.

The top gaining sectoral indices on the BSE were Telecom up by 1.04%, Basic Materials up by 0.30% and FMCG up by 0.02%, while Oil & Gas down by 2.24%, Energy down by 1.95%, PSU down by 1.78%, Auto down by 1.74% and Capital Goods down by 1.25% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 2.10%, Bajaj Finance up by 1.89%, Maruti Suzuki up by 0.71%, Bajaj Finserv up by 0.37% and Indusind Bank up by 0.30%. On the flip side, Mahindra & Mahindra down by 4.75%, Tata Motors down by 2.23%, Larsen & Toubro down by 1.97%, NTPC down by 1.94% and HCL Technologies down by 1.91% were the top losers.

Meanwhile, Industry body the Confederation of Indian Industry (CII) in report 'Unicorn 2.0: Adding the Next Trillion' has said that new unicorns are likely to add $1 trillion to the Indian economy, which would reach $7 trillion size by 2030, and add 50 million new jobs. Startup firms valued over $1 billion are categorised as unicorns.

Sectors such as retail and e-commerce, next-gen financial services, manufacturing, and SaaS and digital are poised to drive massive growth in the coming years. CII said the report 'Unicorn 2.0: Adding the Next Trillion' has been prepared with McKinsey & Company as the knowledge partner.

The first unicorn was seen in India in 2011, and after a decade, India has crossed the mark of 100 unicorns. The combined valuation of 113 unicorns is $350 billion as of January 2024. The industry body said that the emergence of over 100 unicorns is a remarkable achievement, attributed to several pivotal factors, which encompass a digitally adept young population facilitated by widespread access to mobile internet, the growth of the middle class, and a supportive regulatory framework.

The CNX Nifty traded in a range of 22,120.90 and 21,931.70. There were 11 stocks advancing against 39 stocks declining on the index.

The top gainers on Nifty were UPL up by 3.18%, Bharti Airtel up by 1.62%, HDFC Life Insurance up by 1.53%, Bajaj Finance up by 1.37% and Adani Ports and SEZ up by 1.27%. On the flip side, Mahindra & Mahindra down by 4.99%, BPCL down by 4.15%, Coal India down by 2.85%, Tata Motors down by 2.46% and Hero MotoCorp down by 2.23% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 1.22 points or 0.02% to 7,744.37, France’s CAC rose 31.56 points or 0.39% to 8,192.98 and Germany’s DAX gained 49.89 points or 0.28% to 17,991.93.

Asian markets settled mostly down on Friday due to uncertainty over rate cut in June monetary policy after hotter-than-expected the US inflation producer inflation data. The US producer price inflation rose 0.6% in February from last month, Labor Department data showed, that was higher than market expectations of a 0.3% uptick. Meanwhile, Australian markets declined amid expectations that the Reserve Bank of Australia might maintain its hawkish stance at a policy meeting next week. Japanese shares fell tracking Wall Street’s decline overnight and anxiety ahead of next week's Bank of Japan policy meeting. The Bank of Japan is widely expected to put an end to its negative interest rates and yield curve control policies. Hong Kong shares settled down after data showed China's house prices continued to fall in February. However, Chinese shares gained as PBoC left its key policy rate unchanged and withdrew cash from a medium-term policy loan operation for the first time in 16 months.