Post Session: Quick Review

Bears took full control over Indian equity markets on Monday with Nifty and Sensex settling below the psychological 25,850 and 84,300 levels respectively. Investors avoided to take any long positions ahead of key economic indicators from India, including manufacturing, services, composite indices, current account deficit (CAD), external debt, and government budget figures, to be release during this week. Continued selling pressure in last leg of trade forced markets to end near day’s low points. 

Markets made negative start and remained in red amid mixed cues from global markets and escalating Middle East tensions due to Israel intensifying attacks on Iranian-backed forces. Foreign fund outflows also dampened investors sentiments. On September 27, 2024, Foreign Institutional Investors (FIIs) sold shares worth Rs 1,209.10 crore. Investors overlooked commerce and industry minister Piyush Goyal’s statement that actual investments under the Production Linked Incentive (PLI) schemes were Rs 1.46 lakh crore till August and expected to increase to Rs 2 lakh crore in the coming years. This has resulted in production/sales worth Rs 12.5 lakh crore and employment generation of around 9.5 lakh (direct & indirect) which is expected to reach 12 lakh soon. In afternoon session, indices extended their losses, as traders were cautious after the Reserve Bank's former governor Raghuram Rajan said that with 7 per cent economic growth, India is not creating enough jobs as reflected by the number of applicants for vacant posts in some states. He suggested the government needs to focus on promoting labour-intensive industries to generate employment. In late afternoon session, markets lost more ground to touch day’s low points following weak cues from European markets.

On the global front, European markets were trading lower as Middle East worries escalated and investors awaited comments from ECB President Christine Lagarde and Federal Reserve Chair Jerome Powell for additional clues on the rate outlook. Asian markets ended mostly lower as Japanese markets succumbed to selling pressure after Japan's governing party chose Shigeru Ishiba, a critic of the country's longstanding ultralow interest rates, as its leader. Back home, Crisil Ratings has said that India’s oil marketing companies (OMCs) are expected to add 35-40 million tonnes (MT) of crude oil refining capacity by the end of the fiscal 2029-30.

The BSE Sensex ended at 84,299.78, down by 1272.07 points or 1.49% after trading in a range of 84,257.14 and 85,359.65. There were 5 stocks advancing against 25 stocks declining on the index. (Provisional)

The broader indices ended mixed; the BSE Mid cap index declined 0.28%, while Small cap index was up by 0.07%. (Provisional)

The only gaining sectoral indices on the BSE were Metal up by 1.06% and Basic Materials was up by 0.60%, while Auto down by 1.91%, Bankex down by 1.82%, Realty down by 1.80%, Telecom down by 1.19% and Consumer discretionary was down by 1.17% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were JSW Steel up by 2.86%, NTPC up by 1.25%, Tata Steel up by 1.08%, Titan Co up by 0.41% and Asian Paints up by 0.22%. On the flip side, Reliance Industries down by 3.10%, Axis Bank down by 3.09%, ICICI Bank down by 2.56%, Mahindra & Mahindra down by 2.03% and Bajaj Finserv down by 2.02% were the top losers. (Provisional)

Meanwhile, the Union Minister of Commerce & Industry Piyush Goyal has said that the 14 sectors covered under the production linked incentive (PLI) schemes have witnessed investments of Rs 1.46 lakh crore till August and the capital infusion is expected to reach Rs 2 lakh crore in the coming years. This has resulted in production/sales worth Rs 12.50 lakh crore and employment generation of around 9.5 lakh (direct and indirect), which is expected to reach 12 lakh soon. Exports have exceeded Rs 4 lakh crore, with substantial contribution from key sectors such as electronics, pharmaceuticals and food processing.

Goyal urged the Indian industry to focus on prioritising the production of high-quality goods to promote Brand India through sustainable practices. He also called for focusing on increasing domestic value addition and extending support to domestic manufacturers in this regard. He added that the government is committed to fast-tracking all the necessary approvals related to PLI industry and also providing handholding support in achieving greater market access.

The government has rolled out the scheme in 2021 for 14 sectors including electronics, pharmaceuticals, white goods, telecommunication and drones with an outlay of Rs 1.97 lakh crore. It aims to boost domestic manufacturing, attract investments and increase exports. In the electronics sector, mobile phone manufacturing now accounts for half of India's total output, with a ‘3x’ increase in exports since 2020-21. Further in the automobile sector, global champions have rolled out electric vehicles, with substantial investment in the country.

The CNX Nifty ended at 25,810.85, down by 368.10 points or 1.41% after trading in a range of 25,794.10 and 26,134.70. There were 12 stocks advancing against 38 stocks declining on the index. (Provisional)

The top gainers on Nifty were JSW Steel up by 2.85%, NTPC up by 1.44%, Hindalco up by 1.21%, Tata Steel up by 1.20% and Britannia up by 1.11%. On the flip side, Hero MotoCorp down by 4.11%, Trent down by 3.31%, Reliance Industries down by 3.25%, Axis Bank down by 3.22% and Bharat Electronics down by 2.85% were the top losers. (Provisional)

European markets were trading lower; UK’s FTSE 100 decreased 34.33 points or 0.41% to 8,286.43, France’s CAC fell 117.63 points or 1.53% to 7,674.16 and Germany’s DAX was down by 88.98 points or 0.46% to 19,384.65.

Asian markets finished mostly lower on Monday, on risk aversion ahead to this week's US economic data. Sharp selloff in technological and financial sector stocks pressured the local indices. Japan's Nikkei tumbled on risk of more hawkish measures under new Prime minister elect Shigeru Ishiba. Weaker industrial data and sluggishness in export-oriented stocks with the stronger local currency yen also saddled the index further. Bucking the trend, Shanghai and Hang Seng stocks soared amidst optimism over Chinese economic rebound with the latest slew of aggressive stimulus measures from Beijing.