Friday turned out to be a disappointing session of trade for Indian equity benchmarks where frontline gauges failed to hold initial gains and ended with minor losses with Sensex and Nifty managing to hold their crucial 77,200 and 23,500 levels respectively. Traders remained on sidelines as global markets were subdued as weak guidance from Accenture led to profit booking in US tech stocks. Conversely, domestic IT stocks saw buying interest as market participants appeared to have factored in weaker earnings.
Indian equity benchmarks soon after a positive opening entered into red terrain as traders turned their attention on the upcoming GST meeting, where the potential rationalization of GST rates in certain sectors is under discussion. Market participants continued to sell risky assets amid concerns over the slow progress of the monsoon, resulting in underperformance in the FMCG sector. However, heatwave in Northern India is driving consumer durables stocks higher during the trade. Some cautiousness crept in as a report by the United Nations Conference on Trade and Development (UNCTAD) said Foreign Direct Investment (FDI) flows to India plummeted by 43 per cent in 2023 to $28 billion amid a global decline of 2 per cent. Traders were cautious as Minneapolis Fed President Neel Kashkari said that it will probably take a year or two to get inflation back to the central bank's 2 percent target. Also, traders overlooked report that the headline HSBC Flash India Composite Output Index - a seasonally adjusted index that measures the month-on-month change in the combined output of India's manufacturing and service sectors - increased from 60.5 in May to 60.9 in June.
On the global front, Asian markets ended mostly in red as new data showed weakness in the U.S. economy and Treasury yields ticked higher on hawkish comments from Federal Reserve officials. Meanwhile, European markets were trading in red as investors reacted to weak business activity data from the region. Eurozone business recovery slowed sharply in June as the manufacturing sector downturn gathered momentum and activity in the services sector deteriorated. The HCOB's preliminary composite Purchasing Managers' Index, compiled by S&P Global, fell to 50.8 from May's 52.2.
Back home, the BSE Sensex ended at 77209.90, down by 269.03 points or 0.35% after trading in a range of 76802.00 and 77808.45. There were 10 stocks advancing against 20 stocks declining on the index. (Provisional)
The broader indices ended mixed; the BSE Mid cap index down by 0.26%, while Small cap index was up by 0.06%. (Provisional)
The top gaining sectoral indices on the BSE were Telecom up by 1.44%, TECK up by 1.01%, IT up by 0.74%, Consumer Durables up by 0.22% and Power up by 0.10%, while Oil & Gas down by 1.28%, FMCG down by 1.08%, Energy down by 1.02%, Capital Goods down by 0.96%, Basic Materials down by 0.92% were the top losing indices on BSE.
The top gainers on the Sensex were Bharti Airtel up by 1.65%, Infosys up by 0.75%, JSW Steel up by 0.54%, TCS up by 0.35% and Wipro up by 0.25%. On the flip side, Ultratech Cement down by 2.46%, Larsen & Toubro down by 2.12%, Tata Motors down by 1.85%, Nestle down by 1.71% and Tata Steel down by 1.51% were the top losers. (Provisional)
Meanwhile, a labour ministry statement said that retirement fund body Employees’ Provident Fund Organisation (EPFO) has added a record 18.92 lakh net members in April 2024. The addition during the month is the highest since the first payroll data was published in April 2018. An increase of 31.29 per cent was registered in net member addition during April 2024 as compared to March 2024. The surge in membership can be attributed to various factors, including increased employment opportunities, a growing awareness of employee benefits, and the effectiveness of EPFO’s outreach programmes.
The data indicates that around 8.87 lakh new members have enrolled during April 2024. A noticeable aspect of the data is the dominance of the 18-25 age group, constituting a significant 55.50 per cent of the total new members added in April. This is in consonance with the earlier trend, indicating that most individuals joining the organised workforce are youth, primarily first-time jobseekers. The payroll data highlights that about 14.53 lakh members exited and subsequently rejoined EPFO. These members switched their jobs and rejoined the establishments covered under the ambit of EPFO and opted to transfer their accumulations instead of applying for final settlement, thereby safeguarding long-term financial well-being and extending their social security protection.
A gender-wise analysis of payroll data unveils that out of 8.87 lakh new members, about 2.49 lakh are new female members. Also, the net female member addition during the month stood around 3.91 lakh, reflecting an increase of about 35.06 per cent compared to March. The surge in female member additions is indicative of a broader shift towards a more inclusive and diverse workforce. State-wise analysis of payroll data denotes that the net member addition is highest in Maharashtra, Karnataka, Tamil Nadu, Gujarat, and Haryana. These states constitute around 58.30 per cent of net member addition. Of all the states, Maharashtra is leading by adding 20.42 per cent of net members during the month.
The CNX Nifty ended at 23501.10, down by 65.90 points or 0.28% after trading in a range of 23398.20 and 23667.10. There were 19 stocks advancing against 31 stocks declining on the index. (Provisional)
The top gainers on Nifty were Bharti Airtel up by 2.53%, LTIMindtree up by 1.44%, Hindalco up by 1.18%, Infosys up by 1.14% and Adani Ports &Special up by 1.10%. On the flip side, Ultratech Cement down by 2.21%, Adani Enterprises down by 2.15%, BPCL down by 1.76%, Tata Motors down by 1.68% and Tata Consumer Products down by 1.66% were the top losers. (Provisional)
European markets were trading in red; UK’s FTSE 100 decreased 80.00 points or 0.97% to 8,192.46, France’s CAC fell 44.24 points or 0.58% to 7,627.10 and Germany’s DAX was down by 109.08 points or 0.60% to 18,145.10.
Asian markets settled mostly down on Friday due to higher US treasury yields and hawkish comments from Federal Reserve officials on the rate path. Minneapolis Fed President Neel Kashkari noted that it will probably take a year or two to get inflation back to the central bank's 2% target. Chinese shares declined after reports that Canada is preparing potential new tariffs on Chinese-made electric vehicles, while Chinese currency yuan continued to weaken on worries over rising geopolitical tensions between China and the West. Japanese shares dropped tracking losses in technology shares and reports showed that the inflation rate ticked higher for the first time in three months, to 2.5% in May, up from 2.2% in April. Moreover, Seoul shares fell on profit taking in tech and auto shares. However, some losses were limited as a slowing US economy boosted expectations of interest rate cuts by Federal Reserve later this year. Many traders are expecting two or more rate cuts from the Fed this year.
Asian Indices | Last Trade | Change in Points | Change in % |
Shanghai Composite | 2,998.14 | -7.30 | -0.24 |
Hang Seng | 18,028.52 | -306.80 | -1.70 |
Jakarta Composite | 6,879.98 | 60.66 | 0.88 |
KLSE Composite | 1,590.37 | -2.32 | -0.15 |
Nikkei 225 | 38,596.47 | -36.55 | -0.09 |
Straits Times | 3,306.02 | 6.02 | 0.18 |
KOSPI Composite | 2,784.26 | -23.37 | -0.84 |
Taiwan Weighted | 23,253.39 | -152.71 | -0.66 |
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