Post Session: Quick Review

Indian equity markets hit fresh record high on Friday with Nifty and Sensex settling above the psychological 25,200 and 82,300 levels respectively. Since morning, markets hold their gains amid value buying by investors. Besides, positive global markets provided much needed support to the markets. As for broader indices, the BSE Mid cap index and Small cap index ended in green.

Indices made optimistic start and extended their gains driven by positive global trends led by strong Q2 GDP numbers in the US, overnight. Some support also came as Moody's raised India's growth projection for 2024 and 2025. Moody's now expects India's economy to expand 7.2 per cent in 2024 from 6.8 per cent previously, while growth for 2025 is pegged at 6.6 per cent versus 6.4 per cent. Besides, Fitch affirmed India's long-term foreign currency issuer rating at 'BBB-' with a stable outlook, citing a strong medium-term growth outlook. Indices traded firmly in green during afternoon session as sentiments remained optimistic, after the retail inflation rates for farm and rural workers eased in the month of July, with the All-India Consumer Price Index for Agricultural Labourers (CPI-AL) and Rural Labourers (CPI-RL) falling to 6.17% and 6.20%, as compared to 7.43% and 7.26% in July 2023, respectively. The corresponding figures for June 2024 were 7.02% for CPI-AL and 7.04% for CPI-RL. Till the end of the session, markets maintained their gains as investors continue to buy fundamentally strong stocks. 

On the global front, European markets were trading higher ahead of the release of the Eurozone CPI and U.S. PCE inflation data later in the day. All Asian markets ended higher as strong GDP and labor data hinted at a soft landing for the world's largest economy. Back home, industry body Automotive Tyre Manufacturers Association (ATMA) has said that tyre exports from India grew 17 per cent year-on-year to reach Rs 6,219 crore in the first quarter of the current fiscal (Q1FY25) with the US emerging as the biggest market.

The BSE Sensex ended at 82,365.77, up by 231.16 points or 0.28% after trading in a range of 82,256.02 and 82,637.03. There were 23 stocks advancing against 7 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index gained 0.53%, while Small cap index was up by 0.75%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 1.88%, Healthcare up by 1.41%, Utilities up by 0.77%, Basic Materials up by 0.70% and Telecom was up by 0.67%, while there were no losing sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finance up by 2.12%, Mahindra & Mahindra up by 2.01%, NTPC up by 1.71%, Power Grid up by 1.67% and Bajaj Finserv up by 1.47%. On the flip side, Tata Motors down by 0.95%, HDFC Bank down by 0.82%, Reliance Industries down by 0.59%, Tech Mahindra down by 0.51% and ITC down by 0.50% were the top losers.

Meanwhile, citing signs of improving rural demand, Moody's has raised India's growth projection for 2024 and 2025. Moody's now expects India's economy to expand 7.2 per cent in 2024 from 6.8 per cent previously, while growth for 2025 is pegged at 6.6 per cent versus 6.4 per cent. It said ‘These forecast changes assume strong broad-based growth and we recognize potentially higher forecasts if the cyclical momentum, especially for private consumption, gains more traction’.

The agency noted that both industrial and services sectors have demonstrated strong performance, with the services PMI consistently above 60 since the start of the year. It added ‘Household consumption is poised to grow as headline inflation eases toward the RBI's target. Indeed, signs of a revival in rural demand are already emerging, on the back of improving prospects for agricultural output amid above-normal rainfall during the monsoon season’.

The agency also said it expects the capex cycle to gain more steam amid rising capacity utilization, upbeat business sentiment and the government's continued thrust on infrastructure spending. It said over the medium- and longer-term, India's growth prospects depend on how well the country can productively tap its substantial pool of labour. It further said ‘While employment generation and skill development are government priorities, the extent to which India reaps a demographic dividend will depend on whether and how well these policies succeed’. It said ‘Nevertheless, 6 per cent-7 per cent growth should be possible purely on the basis of present conditions.’

The CNX Nifty ended at 25,235.90, up by 83.95 points or 0.33% after trading in a range of 25,199.40 and 25,268.35. There were 37 stocks advancing against 13 stocks declining on the index. (Provisional)

The top gainers on Nifty were Cipla up by 2.25%, Bajaj Finance up by 1.93%, Mahindra & Mahindra up by 1.73%, Divi's Lab up by 1.62% and Bajaj Finserv up by 1.56%. On the flip side, Tata Motors down by 0.92%, Reliance Industries down by 0.74%, Tech Mahindra down by 0.66%, ITC down by 0.63% and Coal India down by 0.49% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 25.2 points or 0.3% to 8,404.84, France’s CAC rose 48.35 points or 0.63% to 7,689.30 and Germany’s DAX was up by 34.87 points or 0.18% to 18,947.44.

Asian markets settled higher on Friday after positive US labour market and GDP data. Meanwhile, investors were awaiting the release of Federal Reserve's preferred inflation metric due later in the day for clues on the Fed's rate trajectory. Japanese shares gained as a weaker yen lifted Japanese export-related shares and after data showed Tokyo's core inflation continued to climb in August, comfortably surpassing the central bank’s 2% target. Seoul shares advanced despite an underwhelming result by AI chipmaker Nvidia. Data showed that industrial production in South Korea falling more than expected in July, driven by a contraction in semiconductor and automobile production.