Post Session: Quick Review

Indian equity markets concluded with gains of over a percent after a range bound day of trade tracing positive global markets cues. Investors were braced for key macroeconomic data i.e. India Industrial Production (IIP) and Consumer Price Index (CPI). Till the end of the session, markets maintained their upward momentum. There were no losing sectoral indices on the BSE. The broader indices, the BSE Mid cap index and Small cap index also ended in green. 

Markets made gap-up opening and remained higher tracking overnight gains on Wall Street as well as firm trade in Asian counterparts, as concerns about the world's largest economy slipping into a recession eased after data released showed a bigger than expected drop in first-time claims for U.S. unemployment benefits last week. Some support also came as the Reserve Bank of India said India's current account deficit (CAD)- excess of imports of goods and services over exports, would be manageable. In afternoon session, indices continued their firm trade as sentiments got boost, after the Reserve Bank of India (RBI) in its latest survey report has showed that households’ optimism on economic conditions for the year ahead remained in positive terrain, though it came down from the previous survey round.  In late afternoon session, investors continued to hunt for fundamentally strong stocks. Finally, Nifty and Sensex settled above the psychological 24,350 and 79,700 levels respectively.

On the global front, European markets were trading higher after new U.S. labor market data eased recession concerns in the world's largest economy. Also, a measure of China's consumer price inflation surged to a five-month high, providing much-need positive news on the world's second-largest economy. Asian markets ended mostly in green following positive cues from the US markets overnight. Back home, Union Commerce and Industry Minister Piyush Goyal asked the country's leather and footwear industry to target $50 billion in exports by 2030. He also asked the industry to take advantage of various free trade agreements (FTAs) signed by India and focus on manufacturing world class products to tap global markets.

The BSE Sensex ended at 79,705.91, up by 819.69 points or 1.04% after trading in a range of 79,549.09 and 79,984.24. There were 27 stocks advancing against 3 stocks declining on the index. (Provisional)

The broader indices were trading in green; the BSE Mid cap index was up by 1.21%, while Small cap index up by 0.79%. (Provisional)

The gaining sectoral indices on the BSE were IT up by 1.59%, Consumer Disc up by 1.57%, Realty up by 1.56%, Auto up by 1.51% and TECK was up by 1.41%, while there were no losing sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were Mahindra & Mahindra up by 3.08%, Tata Motors up by 2.85%, Tech Mahindra up by 2.68%, JSW Steel up by 2.58% and SBI up by 2.17%. On the flip side, Kotak Mahindra Bank down by 0.13%, Maruti Suzuki down by 0.05% and Sun Pharma Inds. down by 0.01% were the top losers.  (Provisional)

Meanwhile, the Governor Shaktikanta Das has said the Reserve Bank of India (RBI) cannot ignore food inflation while formulating the monetary policy. His comments come amid suggestions for excluding food inflation while setting benchmark interest rates. He said that the weightage of food in the overall consumer price inflation, which stands at 46 per cent currently, was done in 2011-12, and needs to be revisited, and added that analysis work is going on by the National Statistical Office (NSO).

In his policy review statement, Das said ‘The MPC (monetary policy committee) may look through high food inflation if it is transitory; but in an environment of persisting high food inflation, as we are experiencing now, the MPC cannot afford to do so’. He added ‘It (MPC) has to remain vigilant to prevent spillovers or second round effects from persistent food inflation and preserve the gains made so far’.

He said the current CPI basket is based on 2011-12 data and the review could not be undertaken because of the Covid pandemic. He said the RBI is in regular touch with the government on the supply side response to inflation, and also discusses flood and heavy rainfall. He said while high rainfall in a district of Kerala and parts of Himachal Pradesh will lead to some impact on prices, overall the monsoon is 7 per cent higher than the long period average and will have a positive impact on the food inflation.

The CNX Nifty ended at 24,367.50, up by 250.50 points or 1.04% after trading in a range of 24,311.20 and 24,419.75. There were 44 stocks advancing against 6 stocks declining on the index. (Provisional)

The top gainers on Nifty were Eicher Motors up by 5.54%, ONGC up by 3.05%, Shriram Finance up by 2.99%, Tech Mahindra up by 2.74% and Tata Motors up by 2.53%. On the flip side, BPCL down by 1.45%, HDFC Life Insurance down by 1.12%, Kotak Mahindra Bank down by 0.17%, Sun Pharma down by 0.10% and Divi's Lab down by 0.09% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 44.35 points or 0.54% to 8,189.32, France’s CAC rose 44.17 points or 0.61% to 7,291.62 and Germany’s DAX was up by 59.33 points or 0.33% to 17,739.73.

Asian markets finished mostly in green on Friday, as the risk appetite got lifted after better-than-expected US weekly jobs data eased recession fears. Rally in technological sector stocks with strong demand in Artificial Intelligence chips kindled the indices in the session. Hang Seng logged third consecutive gain and logged gain of 0.85% for the week. On the flip side, China's Shanghai retreated after consumer prices soared to a five-month high with the weather disruptions and as producer deflation persisted. Moreover, caution ahead to retail trade and industrial output data due next week saddled Shanghai investments. Stock market of Singapore was closed for National day holiday.