Post Session: Quick Review

Indian equity markets witnessed lackluster session following weak cues from other Asian markets. Traders remained cautious ahead of India’s HSBC Services PMI Final and HSBC Composite PMI Final data to be out on September 04. In late afternoon session, markets hit green territory but failed to hold gains and ended flat. Traders were seen piling up positions in Banking sector stocks, while selling was witnessed in Metal and Oil & Gas sectors’ stocks.

Markets made slightly positive start and soon turned negative amid weakness in Asian counterparts as traders largely stayed sidelines and reluctant to make significant moves amid a lack of any new catalyst after a holiday on Wall Street. Some cautiousness came as Chief Economic Advisor (CEA) V Anantha Nageswaran stated that India is well-positioned for strong global economic growth, but the country must be cautious of financialization as it progresses towards becoming a developed nation by 2047. Nageswaran highlighted the risks of an oversized financial market influencing public policy and economic outcomes, a trend that he believes India should avoid. Further, sentiments remained downbeat as Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve. Acharya said after the Covid-19 pandemic, rural consumption and investments have weakened. In late afternoon session, markets hit green territory but unable to hold for long. Invertors overlooked report that World Bank in its latest ‘India Development Update: India’s Trade Opportunities in a Changing Global Context’ has said that the Indian economy continues to grow at a healthy pace despite challenging global conditions. But to reach its $1 trillion merchandise exports goal by 2030, India needs to diversify its export basket and leverage global value chains.

On the global front, European markets were trading mostly in red ahead of the U.S. ISM Manufacturing and Services PMI figures due later today and on Thursday, respectively could give investors further insights into the world's largest economy. Asian markets ended mostly in red as investors awaited more U.S. economic data, including Friday's non-farm payrolls report for August to gauge the size of the Federal Reserve's rate cut later this month. Back home, the government gave the green light to seven major agricultural schemes, totaling around Rs 14,000 crore. This includes a Rs 2,817 crore Digital Agriculture Mission and a Rs 3,979 crore scheme dedicated to crop science.

The BSE Sensex ended at 82,555.44, down by 4.40 points or 0.01% after trading in a range of 82,400.76 and 82,675.06. There were 12 stocks advancing against 18 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index gained 0.19%, while Small cap index was up by 0.54%. (Provisional)

The gaining sectoral indices on the BSE were Consumer Durables up by 1.27%, Capital Goods up by 0.62%, Industrials up by 0.51%, Bankex up by 0.51%, Consumer Disc up by 0.15% while, Utilities down by 0.77%, Oil & Gas down by 0.69%, Metal down by 0.59%, Realty down by 0.53%, TECK down by 0.51% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were ICICI Bank up by 1.37%, Bajaj Finserv up by 1.15%, Titan Co up by 0.85%, HDFC Bank up by 0.77% and Nestle up by 0.75%. On the flip side, Bajaj Finance down by 1.29%, Infosys down by 1.28%, Adani Ports down by 1.10%, JSW Steel down by 0.93% and HCL Tech. down by 0.89% were the top losers. (Provisional)

Meanwhile, expressing optimism over India’s growth momentum, Chief Economic Advisor (CEA) -- V Anantha Nageswaran has said that policy autonomy and managing global capital outflows effectively will safeguard India’s growth momentum.

He said ‘With a modest current account deficit, India relies on global capital flows, but India has one of the brightest global economic growth prospects. It is up to us to sustain this momentum and use it to our advantage in carving out policy space for ourselves’.

He noted that the phenomenon of financialization, characterized by a high level of market capitalization relative to GDP, leads to a disproportionate focus on market expectations and trends which can distort macroeconomic outcomes and policy discourse.

He emphasized ‘As India looks ahead to 2047 with optimism and hope, this is what we must avoid because the consequences of such financialization are evident in many advanced economies, including unprecedented levels of public and private debt, economic growth increasingly dependent on continued asset price inflation, and a massive surge in inequality’.

The CNX Nifty ended at 25,279.85, up by 1.15 points after trading in a range of 25,235.80 and 25,321.70. There were 21 stocks advancing against 29 stocks declining on the index. (Provisional)

The top gainers on Nifty were SBI Life up by 2.11%, HDFC Life Insurance up by 1.80%, Shriram Finance up by 1.44%, ICICI Bank up by 1.44% and Bajaj Finserv up by 1.36%. On the flip side, ONGC down by 1.23%, Infosys down by 1.18%, Bajaj Finance down by 1.16%, JSW Steel down by 1.01% and Adani Ports down by 1.00% were the top losers. (Provisional)

European markets were trading lower; UK’s FTSE 100 decreased 42.32 points or 0.51% to 8,321.52, France’s CAC fell 10.84 points or 0.14% to 7,635.58 and Germany’s DAX was down by 76.15 points or 0.4% to 18,854.70.

Asian markets ended mostly down on Tuesday with caution ahead of critical US economic reports, including Friday's non-farm payrolls report for August to gauge the size of the Federal Reserve's rate cut later this month. Japanese shares declined as the yen rebounded from a two-week low against the US dollar. Chinese and Hong Kong shares fell, dragged by banking and energy shares and disappointing China August manufacturing activity data. Moreover, Seoul shares dropped after data showed South Korea's headline inflation eased from 2.6% to 2% in August, marking its lowest level on a year-on-year basis since March 2021.