Indices remain lackluster in volatile session

Indian equity benchmarks remained lackluster in early afternoon deals, with volatility continued to hit the Dalal Street, after Federal Reserve Chair Jerome Powell signaled that he was in no hurry to make further interest-rate cuts. Investors also reacted to a SEBI meeting outcome, a slew of economic data and heightened tensions in the Middle East. Capital market regulator SEBI has approved the introduction of a new asset class targeting risk-oriented investors and also endorsed the liberalized Mutual Funds Lite (MF Lite) framework, focusing on passively managed schemes. On the geopolitical front, the Israeli military has commenced a 'limited, localized' operation against Hezbollah targets in southern Lebanon, raising concerns about regional stability.

Traders remained cautious amid economic data including slower India's manufacturing sector growth. India's manufacturing sector growth slowed down in the month of September, as rates of expansion in factory production and sales receded for the third straight month, both of which were at their weakest since the turn of the year but above their respective long-run averages. Besides, international orders rose at the slowest pace in a year-and-a-half. According to the survey report, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) eased to 56.5 in September as against 57.5 in August 2024.

On the global front, Asian markets were trading mostly in green, after the manufacturing sector in Indonesia continued to contract in September, albeit at a slower rate, with a manufacturing PMI score of 49.2. That's up from 48.9 in August although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.

The BSE Sensex is currently trading at 84168.09, down by 131.69 points or 0.16% after trading in a range of 84098.94 and 84648.40. There were 10 stocks advancing against 20 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell by 0.01%, while Small cap index was up by 0.38%.

The top gaining sectoral indices on the BSE were IT up by 0.68%, TECK up by 0.52%, Basic Materials up by 0.24%, Industrials up by 0.09% and Bankex up by 0.07%, while Realty down by 0.75%, Oil & Gas down by 0.73%, FMCG down by 0.57%, Energy down by 0.53% and Healthcare down by 0.43% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 3.11%, Mahindra & Mahindra up by 1.82%, Infosys up by 1.31%, SBI up by 1.12% and Adani Ports & SEZ up by 1.09%. On the flip side, Asian Paints down by 1.81%, Indusind Bank down by 1.80%, Hindustan Unilever down by 1.53%, Titan down by 1.44% and Maruti Suzuki down by 1.08% were the top losers.

Meanwhile, the Reserve Bank of India (RBI) has said that India’s current account deficit widened marginally to $9.7 billion or 1.1 per cent of Gross domestic product (GDP) in April-June 2024, as against $8.9 billion or 1 per cent in the year-ago period. The crucial number representing the country’s external sector strength has come on the heels of a surplus of $4.6 billion or 0.5 per cent of GDP recorded in the preceding January-March quarter. 

The RBI attributed the year-on-year widening in current account deficit to a rise in merchandise trade gap which was recorded at $65.1 billion in Q1 FY25 as compared to $56.7 billion in the year-ago period. Net services receipts increased to $39.7 billion during the quarter under review from $35.1 billion a year ago. It added that computer services, business services, travel services and transportation services have seen a rise. However, there was a sharp moderation in the net foreign portfolio investment to $0.9 billion from $15.7 billion in the year ago. Net inflows under external commercial borrowings (ECBs) came down to $1.8 billion during the first quarter, and was lower than $5.6 billion registered in the corresponding period a year ago.

In what can be seen as a jump in remittances by the diaspora, the private transfer receipts increased to $29.5 billion in Q1 FY25, from $27.1 billion witnessed in the same period of last fiscal. Net foreign direct investment inflows increased to $6.3 billion from $4.7 billion on year. Payments of investment income, captured under the net outgo on the primary income account, rose to $10.7 billion from the last year’s $10.2 billion. Non-resident deposits (NRI deposits) recorded net inflows of $4 billion, and was higher than $2.2 billion a year ago. There was an accretion of $5.2 billion to the foreign exchange reserves on a BoP (balance of payments) basis in Q1 FY25 as compared to $24.4 billion in Q1 FY24.

The CNX Nifty is currently trading at 25771.10, down by 39.75 points or 0.15% after trading in a range of 25739.20 and 25907.60. There were 18 stocks advancing against 32 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 3.07%, Mahindra & Mahindra up by 1.94%, Infosys up by 1.43%, SBI up by 1.09% and Adani Ports & SEZ up by 1.09%. On the flip side, Indusind Bank down by 1.79%, Asian Paints down by 1.78%, Bajaj Auto down by 1.77%, Hindustan Unilever down by 1.52% and Titan down by 1.38% were the top losers.

Asian markets were trading mostly in green; Jakarta Composite gained 84.39 points or 1.11% to 7,612.32, Nikkei 225 surged 732.42 points or 1.89% to 38,651.97 and Taiwan Weighted added 165.85 points or 0.74% to 22,390.39, while Straits Times fell 2.62 points or 0.07% to 3,582.67.