Benchmarks end higher on positive global cues

Erasing the losses from the previous session, Indian equity benchmarks made a strong recovery on Friday and ended with gains of over a percent each, as buying activity intensified across all sectors. Markets made a positive start and stayed in green for whole day, following a rally in global equity markets as a larger-than-expected drop in U.S. unemployment claims eased recession fears in the world's largest economy. Traders also took support with the Reserve Bank of India (RBI) stating that India's current account deficit (CAD)- excess of imports of goods and services over exports, would be manageable. Traders took note of Reserve Bank Deputy Governor Michael Patra’s statement that household saving behaviour is returning to ‘normalcy’ now. Drawing from official data, he said there is not a lot of exposure to equities among the households. 

Sentiments remained up-beat in late afternoon deals, taking support from the Reserve Bank of India’s (RBI) latest survey report showing 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. Traders overlooked exchange data showing that Foreign Institutional Investors (FIIs) offloaded equities worth Rs 2,626.73 crore on Thursday.  Meanwhile, capital markets regulator Sebi has proposed a revised format for filing compliance reports by Foreign Venture Capital Investors with regard to their activities. Under the rule, Foreign Venture Capital Investors (FVCI) are required to provide quarterly reports to Sebi in the format specified with respect to their venture capital activities.

On the global front, European markets were trading higher after the number of Americans filing new applications for unemployment benefits fell more than expected last week, calming fears the U.S. economy is heading for a recession. Asian markets finished mostly in green on Friday, as encouraging U.S. labor market data brought some relief to investors worried about a slowing 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.  

Back home, on the sectoral front, healthcare Industry’s stocks were in watch as rating agency ICRA expects the aggregate occupancy for its hospital industry’s sample set companies to remain strong at 61-63% in FY2025 (64.7% in FY2024) backed by sustained healthy demand for healthcare services and continued market share gains for organised players. FMCG sector stocks were in focus with a private report that India’s fast-moving consumer goods sector (FMCG) grew 4 per cent by value in April-June over the same period last year and on the back of relaxed consumption patterns. As per the report, growth in volumes came in at 3.8 per cent. 

Finally, the BSE Sensex rose 819.69 points or 1.04% to 79,705.91, and the CNX Nifty was up by 250.50 points or 1.04% points to 24,367.50.  

The BSE Sensex touched high and low of 79,984.24 and 79,549.09 respectively. There were 28 stocks advancing against 2 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 1.21%, while Small cap index was up by 0.79%.

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

The top gainers on the Sensex were Tech Mahindra up by 2.74%, Tata Motors up by 2.51%, Mahindra & Mahindra up by 2.46%, JSW Steel up by 2.09% and HCL Tech. up by 2.08%. On the flip side, Kotak Mahindra Bank down by 0.20% and Sun Pharma down by 0.01% were the top losers.

Meanwhile, 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. It said lower optimism on general economic situation, employment and prices led to 4.1 point moderation in the future expectations index (FEI) to 120.7 in July 2024. According to the survey report, sentiments on current employment situation and own income deteriorated for the second consecutive survey round. Besides, the outlook for both these parameters also moderated within the zone of optimism.

The results of July 2024 round of its bi-monthly consumer confidence survey (CCS) have been released by RBI. The survey collects current perceptions (vis-a-vis a year ago) and one year ahead expectations of households on general economic situation, employment scenario, overall price situation, own income and spending across 19 major cities. The latest round of the survey was conducted during July 2-11, 2024, covering 6,062 respondents. Female respondents accounted for 54.4 per cent of this sample.

The survey report also showed that consumer confidence for current period declined for the second consecutive survey round after prolonged rising trend in the post-Covid period and their sentiments on major parameters, except spending, moderated and, as a result, the current situation index (CSI) declined to 93.9 in July 2024 from 97.1 two months earlier.

The CNX Nifty traded in a range of 24,419.75 and 24,311.20. There were 45 stocks advancing against 4 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were Eicher Motors up by 5.68%, Mahindra & Mahindra up by 3.05%, Shriram Finance up by 2.88%, Tata Motors up by 2.81% and Tech Mahindra up by 2.63%. On the flip side, HDFC Life Insurance down by 1.09%, Kotak Mahindra Bank down by 0.16%, Maruti Suzuki India down by 0.12% and Sun Pharma down by 0.10% were the top losers.

European markets were trading higher; UK’s FTSE 100 increased 37.62 points or 0.46% to 8,182.59, France’s CAC rose 32.02 points or 0.44% to 7,279.47 and Germany’s DAX gained 51.09 points or 0.29% to 17,731.49.

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.