Markets end with marginal gains on fag-end buying

Indian equity benchmarks bounced back from early lows and managed to eke out marginal gains on Monday on the back of fag-end buying in Capital Goods, Realty and Healthcare shares. Markets started the day on a negative note and stayed under pressure in the first half amid uncertainty among investors due to the ongoing parliamentary elections in India. Traders remained cautious amid sustained foreign fund outflows. Indian markets have witnessed aggressive selling by Foreign Portfolio Investors (FPIs) in May, with a staggering amount of Rs 17,082 crore as per data by National Securities Depository. Some pessimism also came as the government data showed that India’s industrial production growth slowed marginally to 4.9 per cent month-on-month in March 2024, mainly due to poor show by the mining sector. The factory output growth, measured in terms of the Index of Industrial Production (IIP), was 5.6 per cent in February 2024.

Markets trimmed most of their losses in afternoon deals but continued to trade in red, as traders remained on sidelines ahead of India’s Consumer Price Index (CPI) data to be out later in the day. Some concern also came with Ministry of Statistics and Programme Implementation (MoSPI) in its latest report stating that as many as 449 infrastructure projects, each entailing an investment of Rs 150 crore or above, were hit by cost overrun of more than Rs 5.01 lakh crore in March 2024. Out of 1,873 projects, 449 reported cost overrun and 779 projects were delayed. However, by the end, key gauges staged a full recovery from the day's lows and ended up with a marginal gains. Traders found support with think tank GTRI stating that India's exports to the UAE increased by 18.25 per cent to $35.63 billion in 2023-24 as against $30.13 billion in 2018-19, while imports surged 61.21 per cent, from $29.79 billion in FY2019 to $48.02 billion in the last fiscal. Overall, India ranked 17th globally in exports, with a 1.8 per cent share in world trade. On the import front, the country is ranked 8th, holding a 2.8 per cent share in global trade.

On the global front, European markets were trading mostly in red as investors looked ahead to the release of key U.S. inflation data and Fed Chair Jerome Powell's speech due this week for additional clarity on the Fed's rate trajectory. Asian markets ended mostly higher on Monday on renewed optimism about the outlook for interest rates as recent data pointed to some softness in the U.S. labor market, increasing the chances of the US Fed lowering interest rates in the coming months. 

Finally, the BSE Sensex rose 111.66 points or 0.15% to 72,776.13, and the CNX Nifty was up by 48.85 points or 0.22% points to 22,104.05. 

The BSE Sensex touched high and low of 72,863.56 and 71,866.01 respectively. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices ended mixed; the BSE Mid cap index rose 0.36%, while Small cap index was down by 0.23%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.34%, Realty up by 1.32%, Healthcare up by 1.15%, Industrials up by 1.03% and Power up by 0.88%, while Auto down by 1.46%, Energy down by 0.80%, Consumer Disc down by 0.79%, Oil & Gas down by 0.72% and PSU down by 0.63% were the top losing indices on BSE.

The top gainers on the Sensex were Asian Paints up by 3.69%, Sun Pharma up by 1.58%, HDFC Bank up by 1.38%, TCS up by 1.24% and Axis Bank up by 1.17%. On the flip side, Tata Motors down by 8.32%, NTPC down by 1.18%, Bharti Airtel down by 1.12%, Titan Company down by 1.10% and SBI down by 1.08% were the top losers.

Meanwhile, citing several macroeconomic parameters that are doing pretty well, India’s G20 Sherpa and former CEO of Niti Aayog Amitabh Kant has projected that the country is all set to overtake Japan as 4th largest economy in the world by 2025. The size of India’s GDP is currently ranked 5th, after the US, China, Germany, and Japan. It overtook the UK in 2022.

Just a decade ago, Indian GDP was the eleventh largest in the world. Currently, India’s GDP is estimated to be around $3.7 trillion. Some highlights of India’s journey to the top 5 economies of the world in 2024 from Fragile 5 in 2013, according to Kant, among others, record GST collection, over 8 per cent GDP growth in the past three quarters, trading in Indian currency Rupee with various countries (to be precise 27), inflation at manageable levels.

The term Fragile 5 was coined by a Morgan Stanley analyst in 2013 and refers to a set of five emerging countries, including India, whose economy was not doing well back then. The other four countries were Brazil, Indonesia, South Africa, and Turkey. Double-digit growth in the steel, cement, and automobile manufacturing sectors; global leader in digital public infrastructure, with e-transactions surging to 134 billion, accounting for 46 per cent of all global digital payments; accounts opened under Jan Dhan, Aadhaar and Mobile trinity have over Rs 2.32 lakh crore as current balance; average annual inflation between 2013-14 and 2022-23 declined to 5 per cent from 8.2 per cent between 2003-04 and 2013-14 are some other things he attributed to India’s firm growth.

The CNX Nifty traded in a range of 22,131.65 and 21,821.05. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Cipla up by 6.08%, Asian Paints up by 3.85%, HDFC Life Insurance Company up by 3.57%, Adani Enterprises up by 3.27% and Adani Ports & SEZ up by 3.03%. On the flip side, Tata Motors down by 8.34%, BPCL down by 1.72%, Shriram Finance down by 1.67%, Coal India down by 1.15% and NTPC down by 1.13% were the top losers.

European markets were trading mostly in red; France’s CAC fell 13.84 points or 0.17% to 8,205.30 and Germany’s DAX was down by 40.50 points or 0.22% to 18,732.35. On the flip side, UK’s FTSE 100 was up by 3.54 points or 0.04% to 8,437.30.

Asian markets ended mostly higher on Monday despite caution ahead of key US inflation data and Fed Chair Jerome Powell's speech due this week that might shed additional light on the outlook for interest rates. Hong Kong shares gained as China's finance ministry said that it will start selling the first batch of 1 trillion yuan ($138 billion) of ultra-long special sovereign bonds on Friday to help stimulate key sectors. However, Chinese shares declined after the release of weak Chinese lending data and news that the US government plans to raise tariffs on a raft of Chinese exports. Japanese shares fell ahead of Q1 GDP data due to be released on Thursday. The Bank of Japan said it would cut its purchases of long-term Japanese government bonds at each of its funds-supplying operations.