Key gauges close marginally lower on Monday

Indian equity benchmarks closed marginally lower on Monday as investors turned cautious after US-based Hindenburg Research raised allegations against capital market regulator Sebi's chairperson. Markets made a negative start as latest data released by the Reserve Bank of India (RBI) showed that deposit growth of commercial banks further slowed down to 10.64 per cent for the fortnight ending June 28. Credit growth also declined during the period. According to the data, scheduled commercial banks’ credit rose by 13.88 per cent year-on-year (Y-o-Y) to Rs 163.8 trillion as on June 28. The deposit base of banks expanded by 10.64 per cent Y-o-Y to Rs 211.95 trillion. Traders overlooked the latest data from the Reserve Bank of India showing that India's foreign exchange reserves rose by $7.53 billion to a new record high of $674.91 billion for the week ended August 2. The total reserves increased on the back of a rise in foreign currency assets, which rose by $5.16 billion to $592.03 billion during the week.

However, markets recovered all the early lost ground and traded higher during the afternoon trade amid positive trends in global equities and fresh foreign fund inflows. According to exchange data, Foreign Institutional Investors (FIIs) turned buyers on Friday after days of offloading equities. They bought equities worth Rs 406.72 crore. Traders took support with the Comptroller and Auditor General (CAG) stating that the central government was back on the path of fiscal consolidation in 2021-22, having ‘recovered ground’ from the pandemic year, and its ability to sustain debt improved. Sentiments remained upbeat as the Reserve Bank of India (RBI) in its latest report has showed that India’s outward foreign direct investment (OFDI) commitments surged 33.93% to $2915.16 million in July 2024 as against $2176.67 million in July 2023. Sequentially also, they rose from $2189.96 million in June 2024. Outbound FDI, expressed as a financial commitment, comprises three components: equity, loans, and guarantees. But, markets failed to hold gains and ended with minor cuts as traders remained on sidelines ahead of the India’s Consumer Price Index (CPI) inflation and Index of Industrial Production (IIP) data to be out on August 12.

On the global front, European markets were trading mostly in green as overwhelming expectations of a Fed rate cut in September is supporting market sentiment. Asian markets settled mostly higher on Monday, amidst an assessment that concerns about economic growth in the U.S. were overdone. Anxiety ahead of the CPI data due from the U.S. on Wednesday however limited gains. Back home, on the sectoral front, cement industry stocks were in focus with report that leading cement manufacturers reported single-digit volume growth in the June quarter, though their topline was muted on account of the continued downtrend in the price. There was some buzz in coal industry stocks as India's coal import rose by 5.7 per cent to 75.26 million tonnes (MT) in the first quarter of the current fiscal compared to 71.16 MT of coal in the same period of the previous fiscal.

Finally, the BSE Sensex fell 56.99 points or 0.07% to 79,648.92, and the CNX Nifty was down by 20.50 points or 0.08% points to 24,347.00.   

The BSE Sensex touched high and low of 80,106.18 and 79,226.13 respectively. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.04%, while Small cap index was up by 0.51%.

The top gaining sectoral indices on the BSE were Realty up by 1.30%, Consumer Durables up by 0.91%, Oil & Gas up by 0.90%, Metal up by 0.55% and IT up by 0.36%, while Utilities down by 1.04%, FMCG down by 0.67%, Power down by 0.62%, PSU down by 0.34% and Auto down by 0.21% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 1.80%, Infosys up by 1.51%, JSW Steel up by 1.47%, Tata Motors up by 0.81% and HDFC Bank up by 0.70%. On the flip side, NTPC down by 2.40%, Adani Ports &SEZ down by 2.02%, Power Grid Corporation down by 1.43%, SBI down by 1.36% and Nestle down by 1.20% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) in its latest report has showed that India’s outward foreign direct investment (OFDI) commitments surged 33.93% to $2915.16 million in July 2024 as against $2176.67 million in July 2023. Sequentially also, they rose from $2189.96 million in June 2024.

Outbound FDI, expressed as a financial commitment, comprises three components: equity, loans, and guarantees. According to the data report, the equity commitments grew 282.41% to $1948.12 million in July 2024 from $509.43 million in July 2023. Besides, it was sequentially also up from $503.08 million recorded in June 2024. 

The report further noted that debt commitments (loans) declined 53.50% substantially to $284.63 million in July 2024, from $612.09 million a year ago. It was also lower than $460.95 million in June 2024. Guarantees for overseas units fell 35.33% to $682.41 million in July 2024 from $1055.15 million in July 2023. They were also lower than $1225.93 million in June 2024.

The CNX Nifty traded in a range of 24,472.80 and 24,212.10. There were 19 stocks advancing against 30 stocks declining, while 1 stock remained unchanged on the index.

The top gainers on Nifty were ONGC up by 2.59%, Hero MotoCorp up by 2.15%, Axis Bank up by 1.80%, JSW Steel up by 1.53% and Divi's Laboratories up by 1.46%. On the flip side, Adani Ports &SEZ down by 2.33%, NTPC down by 2.16%, Dr. Reddy's Lab down by 1.76%, Britannia Industries down by 1.59% and Adani Enterprises down by 1.46% were the top losers.

European markets were trading mostly in green; UK’s FTSE 100 increased 40.44 points or 0.5% to 8,208.54 and Germany’s DAX gained 18.88 points or 0.11% to 17,741.76, while France’s CAC fell 7.05 points or 0.1% to 7,262.66.

Asian markets settled mostly higher on Monday, tracking Wall Street’s gains last Friday as concerns over a possible recession in the United States eased following better-than-expected unemployment data. Meanwhile investors were awaited more cues from key US inflation and retail sales data due later in the week for further insight into the health of the world’s biggest economy. However, some gains were limited by growing tensions in the Middle East. Japanese market was closed for Mountain Day holiday in Japan.