Post Session: Quick Review

Indian equity markets held their gains till the end of the session with Nifty and Sensex settling above the psychological 25,250 and 82,500 levels respectively. Markets scaled new peak during the day. Investors overlooked weak output of eight core industries and manufacturing sector data. Sector wise, IT and banking sector stocks ended in green. As for broader indices, the BSE Mid cap index and Small cap index concluded in red.

Markets made positive start and extended their gains tracking broadly positive cues from Wall Street on Friday after U.S. economic data alleviated growth concerns. Sentiments got some support as the RBI said India’s forex reserves jumped by $7.023 billion to touch a new high of $681.688 billion in the week ended August 23. Investors overlooked the government data showing that India’s economic growth slowed to a 15-month low of 6.7% in April-June 2024-25, mainly due to poor performance of the agriculture and services sectors. The GDP expanded by 8.2% in the April-June quarter of 2022-23. Besides, private-sector survey showed India's manufacturing activity growth eased to a three-month low in August as demand softened significantly, casting another shadow over the otherwise robust economic outlook. The HSBC final India Manufacturing Purchasing Managers' Index, compiled by S&P Global, fell for a second month in August, dropping to 57.5 from July's 58.1 and below a preliminary estimate of 57.9. In afternoon session, markets came off from day’s high but continued to trade in green, as traders continue to take support with the government data showing that Gross Goods and Services Tax (GST) collections in the month of August 2024 grew 10 per cent to about Rs 1.75 lakh crore. In July 2024, gross GST mop-up was Rs 1.82 lakh crore, while in August 2023 it was Rs 1.59 lakh crore. As per the data, gross GST revenues from domestic transactions grew 9.2 per cent to about Rs 1.25 lakh crore. Revenues from import of goods were up 12.1 per cent to Rs 49,976 crore. Finally, markets closed the day in green. 

On the global front, European markets were trading lower after a survey showed France's manufacturing activity contracted at its fastest pace since January in August as a result of a sharp fall in output and new orders. Asian markets ended mixed as Chinese and Hong Kong markets fell on economic concerns. Back home, Global Trade Research Initiative (GTRI) said India has recorded trade surplus with as many as 151 countries such as the US and Netherlands, while the country has a trade deficit with 75 nations including China and Russia during the first half of this year.

The BSE Sensex ended at 82,559.84, up by 194.07 points or 0.24% after trading in a range of 82,440.93 and 82,725.28. There were 18 stocks advancing against 12 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index declined 0.03%, while Small cap index was down by 0.47%. (Provisional)

The top gaining sectoral indices on the BSE were FMCG up by 0.75%, Utilities up by 0.55%, IT up by 0.37%, Bankex up by 0.32% and Energy was up by 0.11%, while Telecom down by 1.65%, Metal down by 1.18%, Industrials down by 0.82%, Capital Goods down by 0.81% and Healthcare was down by 0.43% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Bajaj Finserv up by 3.23%, Bajaj Finance up by 3.19%, HCL Tech. up by 3.13%, ITC up by 1.60% and Indusind Bank up by 1.55%. On the flip side, NTPC down by 1.57%, Tata Motors down by 1.52%, Mahindra & Mahindra down by 1.04%, Bharti Airtel down by 0.97% and Power Grid down by 0.61% were the top losers. (Provisional)

Meanwhile, India's manufacturing sector growth slowed down in the month of August, amid softer increases in new business and output, albeit with rates of expansion remaining elevated by historical standards. Besides, business confidence retreated, but firms scaled up buying levels in a bid to safeguard against input shortages.  

According to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) eased to 57.5 in August 2024 as against 58.1 in July 2024, but above its long-run average of 54.0, signaling a substantial improvement in operating conditions.

The report noted that new business rose sharply midway through the second fiscal quarter, but the pace of expansion eased to a seven-month low. Competitive conditions reportedly dampened growth. New export orders likewise increased at the weakest pace since the start of the 2024 calendar year. Although output continued to rise at a historically sharp pace, the rate of expansion moderated to the slowest since January. 

On the price front, with input cost inflation receding, goods producers sought to rebuild safety stocks by purchasing additional raw materials and semi-finished goods. Despite the slowdown in cost pressures, there was a marked increase in prices charged for Indian goods in August. The rate of inflation was the second-fastest in close to 11 years. Firms reportedly shared additional cost burdens with their clients amid demand resilience.

Further, job creation softened midway through the second fiscal quarter as a few firms trimmed headcounts. Nevertheless, the overall rate of employment growth was solid in the context of historical data. Besides, competitive pressures and inflation concerns hampered business confidence in the reported month.

The CNX Nifty ended currently trading at 25,278.70, up by 42.80 points or 0.17% after trading in a range of 25,235.50 and 25,333.65. There were 27 stocks advancing against 23 stocks declining on the index. (Provisional)

The top gainers on Nifty were Bajaj Finance up by 3.33%, Bajaj Finserv up by 3.22%, HCL Tech. up by 3.05%, Hero MotoCorp up by 2.25% and Bajaj Auto up by 2.15%. On the flip side, Hindalco down by 2.49%, Dr. Reddy's Lab down by 2.26%, Tata Motors down by 1.68%, NTPC down by 1.49% and ONGC down by 1.38% were the top losers. (Provisional)

European markets were trading lower; UK’s FTSE 100 decreased 6.93 points or 0.08% to 8,369.70, France’s CAC fell 16.86 points or 0.22% to 7,614.09 and Germany’s DAX was down by 27.99 points or 0.15% to 18,878.93.

Asian markets settled mixed on Monday as Chinese shares declined after mixed factory activity indicators raised new questions about efforts to stimulate Chinese economy. China's manufacturing activity returned to expansion in August, a widely watched private survey showed on Monday even as the official reading pointed to a deeper contraction. Hong Kong shares fell after Hong Kong-based property developer New World Development Company said it expects to post its first annual loss in two decades. Japanese shares gained slightly tracking Wall Street’s gains Friday and after data showed Japan's manufacturing activity moved closer to stabilization in August. A weaker yen also lifted Japanese automakers’ shares. Meanwhile, Seoul shares rose after a survey revealed that South Korea's factory activity growth quickened in August.