Post Session: Quick Review

In volatile trading session, Indian equity markets gained some traction during last leg of trade which helped them to end session in green terrain on Wednesday. Most part of the time, indices traded near neutral lines, as investors turned their attention towards upcoming U.S. Federal Reserve policy meeting minutes and Chair Jerome Powell’s address later this week for indications on future rate cuts. Traders were seen piling up positions in Metal sector stocks, while selling was witnessed in banking sector stocks. The broader indices, the BSE Mid cap index and Small cap index ended in green on Wednesday. 

Markets made negative start and soon turned volatile amid foreign fund outflows. According to exchange data, Foreign Institutional Investors (FIIs) again turned sellers on Tuesday as they offloaded equities worth Rs 1,457.96 crore. Traders took note of Reserve Bank of India Governor Shaktikanta Das’ statement India’s inflation must show signs of settling around the central bank’s target of 4 percent on a sustainable basis before a rate cut can be considered. The inflation rate in July eased below the RBI’s target for the first time since 2019, but the central bank expects it to climb back again from September. Indices wavered between green and red territory in afternoon session, as traders avoided to take risk. Traders took note of report that Krishnamurthy V Subramanian, executive director, International Monetary Fund (IMF), said Indian economy is slated to grow to $55 trillion by 2047, if the country is able to register an average real growth rate of 8 per cent in the coming years with average inflation remaining around 5 per cent. However, in last leg of trade, markets held their gains to end in green. 

On the global front, European markets were trading higher amid signs of easing Middle East tensions and growing expectations of a Fed rate cut in September. Asian markets ended mostly in red as investors awaited cues on future rate cuts in the U.S. Back home, Union minister Dharmendra Pradhan has emphasised the need to enhance exports from eastern India and sought cooperation from the state governments in the region.

The BSE Sensex ended at 80,905.30, up by 102.44 points or 0.13% after trading in a range of 80,626.38 and 80,952.83. There were 17 stocks advancing against 13 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index gained 0.43%, while Small cap index was up by 0.87%. (Provisional)

The top gaining sectoral indices on the BSE were Consumer Durables up by 1.56%, FMCG up by 1.33%, Healthcare up by 0.94%, Metal up by 0.73% and Telecom was up by 0.66%, while Realty down by 1.31%, Power down by 0.17%, Bankex down by 0.17% and Utilities was down by 0.01% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Titan Co up by 2.46%, Asian Paints up by 1.53%, ITC up by 1.42%, Hindustan Unilever up by 1.35% and Nestle up by 1.30%. On the flip side, Ultratech Cement down by 1.51%, Tata Steel down by 1.30%, Tech Mahindra down by 1.21%, Power Grid Corp down by 0.91% and HDFC Bank down by 0.74% were the top losers. (Provisional)

Meanwhile, Moody's Ratings in its latest report on corporates in India and Indonesia has said that rated Indian companies will spend $45-50 billion annually over the next 1-2 years towards capex as companies boost capacity, with the country's most valued firm Reliance Industries alone accounting for 30 per cent of the spendings. 

It said investments to increase vertical integration and achieve net zero targets will also keep spending high. The oil and gas sector and Reliance Industries will collectively account for over 60 per cent of the rated Indian portfolio's spending over the next couple of years. It stated the seven rated oil and gas companies in India will also account for around 30 per cent of rated Indian companies' capex. These companies will spend around $15 billion annually to expand existing capacity and make green energy investments to reduce carbon transition risk.

It added for instance, Oil and Natural Gas Corporation (Baa3 stable) and Indian Oil will spend $6 billion and $4 billion, respectively, in each of the next two years on reserves addition, downstream integration and energy transition. Moreover, it said strong earnings will continue to keep the leverage of Indian corporates low, even as companies push ahead with capital spending plans in response to consumption growth and as offshore borrowing rates remain high.

The CNX Nifty ended at 24,770.20, up by 71.35 points or 0.29% after trading in a range of 24,654.50 and 24,787.95. There were 37 stocks advancing against 13 stocks declining on the index. (Provisional)

The top gainers on Nifty were Divi's Lab up by 3.76%, Titan Company up by 2.46%, SBI Life up by 2.23%, Cipla up by 2.03% and HDFC Life Insurance up by 1.96%. On the flip side, Tech Mahindra down by 1.47%, Tata Steel down by 1.31%, Ultratech Cement down by 1.31%, Power Grid down by 1.13% and ONGC down by 0.73% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 20 points or 0.24% to 8,293.32, France’s CAC rose 24.93 points or 0.33% to 7,510.66 and Germany’s DAX was up by 65.88 points or 0.36% to 18,423.40. 

Asian markets finished mostly lower on Wednesday as investors awaited the US interest rate policy direction from minutes of the Fed's July meeting due to be published later today and US Fed Chair Powell's keynote speech on Friday. Japanese shares declined after data showed that the country’s balance of trade fell back into the red in July, while the yen strengthened back to the 145 levels per dollar and dimmed the outlook for exporters. Hong Kong shares fell as shares of e-commerce giant JD.com tumbled after its biggest shareholder Walmart sold its stake in the firm.