Post Session: Quick Review

Indian equity benchmarks hit fresh record highs on Tuesday’s trade but rapid selling which emerged in late trade forced markets to end flat. Nifty soared towards 26,000 mark for the first time during the day as rally in metal stocks following China's fresh stimulus measures. Besides, investors sentiments continued optimism over the US Fed rate cut. The broader indices, the BSE Mid cap index and Small cap index ended mixed.

After making cautious start, markets gained traction to trade in green amid foreign fund inflows. As per NSE data, Foreign Institutional Investors (FII) were net buyers of Indian equities worth Rs 404.42 crore on Monday. Traders got support as S&P Global Ratings retained India's growth forecast at 6.8 per cent for the current fiscal and said it expects the RBI to start cutting interest rates in its October monetary policy review. In the economic outlook of Asia Pacific, S&P Global Ratings also retained its GDP growth forecast for the 2025-26 fiscal at 6.9 per cent and said solid growth in India will allow the Reserve Bank to focus on bringing inflation in line with its target. Some support also came as rating agency ICRA, in its latest report Southwest Monsoon 2024 - Update, asserted that above-normal monsoon rains that helped farmers sow more crops this Kharif season bode well for agriculture, and are likely to improve gross value addition (GVA) in the sector. It stated that the GVA growth of agriculture, forestry, and fishing will improve to 3.2 per cent in the current financial year 2024-25 from 1.4 per cent in 2023-24. However, in afternoon session, markets turned negative for little time amid some profit booking, but markets managed to regain their ground as investors continued to hunt for fundamentally strong stocks. Although, in last leg of trade indices witnessed sharp selling to end flat on Tuesday. 

On the global front, European markets were trading higher amid People's Bank of China said it would cut the reserve requirement ratio by 0.5 percentage points in the near future. Asian markets ended mostly higher after a slew of stimulus measures from China aimed at shoring up economic growth spurred investor appetite for riskier assets. Back home, annual Periodic Labour Force Survey report stated that India's unemployment rate remained unchanged at 3.2% in 2023-24 (July-June), as female unemployment rose to 3.2 percent from 2.9 percent in the previous year.

The BSE Sensex ended at 84,914.04, down by 14.57 points or 0.02% after trading in a range of 84,716.07 and 85,163.23. There were 16 stocks advancing against 14 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index gained 0.21%, while Small cap index was down by 0.04%. (Provisional)

The top gaining sectoral indices on the BSE were Metal up by 2.78%, Power up by 1.38%, Utilities up by 1.18%, Basic Materials up by 0.95% and Oil & Gas was up by 0.61%, while FMCG down by 0.75%, Telecom down by 0.57%, Realty down by 0.32%, Consumer Durables down by 0.31% and Bankex was down by 0.30% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Tata Steel up by 4.29%, Power Grid up by 2.70%, Tech Mahindra up by 1.88%, HCL Tech up by 1.49% and Mahindra & Mahindra up by 0.78%. On the flip side, Hindustan Unilever down by 2.46%, Ultratech Cement down by 1.54%, Indusind Bank down by 1.16%, Kotak Mahindra Bank down by 1.13% and Titan Company down by 1.00% were the top losers. (Provisional)

Meanwhile, credit rating agency, S&P Global Ratings in its latest report ‘the economic outlook of Asia Pacific’ has retained India's growth forecast at 6.8 per cent for the current fiscal and for the fiscal 2025-26 at 6.9 per cent. The rating agency is expecting the RBI to start cutting interest rates in its October monetary policy review. According to it, solid growth in India will allow the Reserve Bank of India (RBI) to focus on bringing inflation in line with its target.

S&P said the RBI considers food inflation a hurdle for rate cuts. It reckons that unless there is a lasting and meaningful decline in the rate at which food prices are increasing it will be tough to maintain headline inflation at 4 per cent. The rating agency is expecting inflation to average 4.5 per cent in the current fiscal.

Meanwhile, the Indian economy grew 8.2 per cent in the last fiscal, while the RBI's interest rate-setting monetary policy committee is set to meet on October 7-9. The central bank has held the benchmark interest rate steady at 6.5 per cent since February 2023 to keep inflation under check.

The CNX Nifty ended at 25,940.40, up by 1.35 points or 0.01% after trading in a range of 25,886.85 and 26,011.55. There were 25 stocks advancing against 25 stocks declining on the index. (Provisional)

The top gainers on Nifty were Tata Steel up by 4.25%, Hindalco up by 3.95%, Power Grid Corp up by 2.61%, Tech Mahindra up by 1.86% and Adani Enterprises up by 1.64%. On the flip side, SBI Life down by 2.91%, Hindustan Unilever down by 2.58%, Grasim Industries down by 1.78%, Ultratech Cement down by 1.68% and Shriram Finance down by 1.44% were the top losers. (Provisional)

European markets were trading higher; UK’s FTSE 100 increased 24.8 points or 0.3% to 8,284.51, France’s CAC rose 120.23 points or 1.58% to 7,628.31 and Germany’s DAX was up by 133.7 points or 0.7% to 18,980.49.

Asian markets ended mostly higher on Tuesday amid increasing expectations that the US central bank will lower borrowing costs for the second consecutive meeting, following last week’s 50 basis points cut. Chinese shares rose after its central bank PBoC unveiled its biggest stimulus measures since the pandemic to support the Chinese economy. Japanese shares gained as traders returned from a holiday. Meanwhile, BoJ Governor Kazuo Ueda has reiterated his cautious tone and said the central bank can wait to act until economic uncertainties become clearer, dampening speculation of an October rate hike.