Markets end flat amid range bound session

Indian equity benchmarks ended flat in a range bound session on Monday as investors preferred to remain on the sidelines awaiting further triggers. Market participants also booked profits in select blue-chip stocks amid high valuation concerns. Markets made a positive start and stayed in green for most part of the day, amid foreign fund inflows. The foreign institutional investors (FIIs) turned net buyers on August 16 as they bought equities worth Rs 766 crore. However, key gauges erased initial gains and traded flat with negative bias in late morning deals, as traders turned cautious as data released by the Reserve Bank of India showed that India’s foreign exchange reserves decreased by $4.8 billion, reaching $670.12 billion for the week ending August 9, falling from the previous all-time high. Forex reserves, as of August 2, had touched an all time high of $675 billion, reflecting a robust external sector performance.

But, markets regained traction and managed to keep their heads above water in second half of trading session, as traders were getting some support amid reports that Chief negotiators of India and Australia will begin the next round of talks for the comprehensive free trade agreement from today in Sydney, where both sides are likely to close negotiations on several chapters of the pact. Traders took note of International Monetary Fund’s (IMF) deputy managing director Gita Gopinath’s statement that India should invest in creating a skilled workforce, putting in place a better infrastructure while undertaking land, labour and taxation reforms to meet its aspiration to become a developed country by 2047. But, markets failed to hold gains and ended largely unchanged as selling pressure from automobile and banking stocks weighed on the indices. Meanwhile, a government survey showed that the unemployment rate in urban areas for individuals aged 15 years and above was 6.6 per cent in April - June 2024 (Q1 FY25), remaining unchanged from the first quarter of FY24. As per the Periodic Labour Force Survey, India's unemployment rate for the quarter ended on June 30 declined from Q4 FY24 when the rate stood at 6.7 per cent. 

On the global front, European markets were trading mostly in green on optimism that the U.S. economy would dodge a recession, and cooling inflation would kick off a cycle of interest rate cuts. Asian markets settled mostly higher on Monday as investors awaited cues from the FOMC meeting minutes along with speeches by Fed Chair Jerome Powell and other Fed speakers this week for additional clues on the rate trajectory.  

Back home, on the sectoral front, stocks of construction equipment industry were in focus as data released by the Indian Construction Equipment Manufacturers' Association (ICEMA) showed that India's construction equipment industry witnessed a 5 per cent rise in sales to 28,902 units during the April-June quarter of 2024-25. As per the data, the construction equipment (CE) industry had sold 27,577 units in the same period of the previous fiscal. FMGC stocks were in watch with a private report that fast-moving consumer goods (FMCG) companies expect to sustain volume growth in the coming quarters, buoyed by recovery of demand in rural markets and good monsoon, despite concerns over growing food inflation.

Finally, the BSE Sensex fell 12.16 points or 0.02% to 80,424.68, and the CNX Nifty was up by 31.50 points or 0.13% to 24,572.65.    

The BSE Sensex touched high and low of 80,724.40 and 80,332.65 respectively. There were 18 stocks advancing against 12 stock declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.53%, while Small cap index was up by 1.33%.

The top gaining sectoral indices on the BSE were Metal up by 2.28%, Oil & Gas up by 1.76%, Energy up by 1.52%, Consumer Durables up by 1.30% and Utilities up by 1.17%, while Auto down by 0.85%, Bankex down by 0.36% and Capital Goods down by 0.05% were the few losing index on BSE.

The top gainers on the Sensex were Tata Steel up by 2.94%, TCS up by 1.65%, NTPC up by 1.19%, JSW Steel up by 1.16% and Asian Paints up by 0.89%. On the flip side, Mahindra & Mahindra down by 2.65%, Indusind Bank down by 1.30%, Axis Bank down by 1.20%, Bharti Airtel down by 1.01% and Tata Motors down by 1.00% were the top losers.

Meanwhile, the quarterly Periodic Labour Force Survey (PLFS) data, released by the National Statistical Office (NSO) showed that the unemployment rate for people aged 15 years and above in urban areas remained unchanged at 6.6 per cent in the April-June quarter (Q1FY25). The unemployment rate in the June quarter of FY24 (Q1FY24) was also 6.6 per cent. Joblessness, or unemployment rate, is defined as the percentage of unemployed people in the labour force.

According to survey, the unemployment rate for people aged 15 years and above in the previous January-March quarter of FY24 (Q4FY24) was 6.7 per cent in urban areas. It also showed that the unemployment rate among females (aged 15 years and above) in urban areas declined to 9 per cent in April-June 2024 from 9.1 per cent in the same quarter a year ago. The rate was 8.5 per cent in January-March, 2024. Among males, the unemployment rate in urban areas declined to 5.8 per cent in April-June from 5.9 per cent in the same quarter a year ago. The rate was 6.1 per cent in January-March 202.

It also stated that labour force participation rate in Current Weekly Status (CWS) in urban areas for people aged 15 years and above increased to 50.1 per cent in April-June from 48.8 per cent in the same quarter a year ago. The rate was 50.2 per cent in the January-March 2024. At the all-India level, in the urban areas, a total number of 5,735 FSUs (urban sampling unit curved out from Urban Frame Survey) have been surveyed during April-June 2024. 

The CNX Nifty traded in a range of 24,638.80 and 24,522.95. There were 31 stocks advancing against 19 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 4.00%, Shriram Finance up by 3.47%, BPCL up by 3.32%, Tata Steel up by 3.06% and LTIMindtree up by 2.00%. On the flip side, Mahindra & Mahindra down by 2.59%, Bajaj Auto down by 1.17%, Indusind Bank down by 1.07%, Axis Bank down by 1.02% and SBI Life Insurance down by 0.96% were the top losers.

European markets were trading mostly in green; France’s CAC rose 25.69 points or 0.34% to 7,475.39 and Germany’s DAX gained 20.19 points or 0.11% to 18,342.59, while UK’s FTSE 100 decreased 7.32 points or 0.09% to 8,304.09.