Post Session: Quick Review

Indian equity markets fell sharply on Friday with Sensex and Nifty settling below the crucial 81,700 and 25,050 levels, respectively. Concerns over the escalating conflict in the Middle East have raised fears of potential disruptions to crude supplies from the top oil-producing region, pushing prices higher - a situation that impacts net importers like India. Besides, cautiousness prevailed in the markets with weak HSBC India Composite PMI Output data. As for broader indices, the BSE Mid cap index and Small cap index ended with cut of over half a percent.

After making cautious start, markets turned volatile amid foreign fund outflows. On October 3, Foreign Institutional Investors (FIIs) sold shares worth Rs 15,243.27 crore. Further, markets maintained their gains till afternoon session. Market participants overlooked report that the HSBC final India Services purchasing managers' index, compiled by S&P Global, fell to 57.7 in September from a five-month high of 60.9 in August and was below a preliminary estimate of 58.9. Growth in India's dominant services sector remained robust but slackened to a 10-month low in September as demand slowed. Further, the HSBC India Composite PMI Output Index -- which measures both manufacturing and services -- also eased to 58.3 in September as against 60.7 in August. However, markets failed to protect their gains and witnessed sharp fall ahead of Reserve Bank of India (RBI) Interest Rate Decision slated to be announced on October 09. In late afternoon session, markets continued their downward trade, as investors avoided to take risk.  

On the global front, European markets were trading mostly in green after falling sharply in the previous session on concerns over a worsening conflict in the Middle East. Asian markets settled mostly higher on Friday as investors looked ahead to the all-important U.S. jobs report later in the day that could decide the path of U.S. interest rates. Back home, CareEdge Global IFSC, a subsidiary of CARE Ratings, has assigned a BBB+ rating to India, reflecting the country’s strong post-pandemic recovery and its focus on infrastructure investments.

The BSE Sensex ended at 81,688.45, down by 808.65 points or 0.98% after trading in a range of 81,532.68 and 83,368.32. There were 8 stocks advancing against 22 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index declined 0.94%, while Small cap index was down by 0.80%. (Provisional)

The gaining sectoral indices on the BSE were IT up by 0.41% while, FMCG down by 1.67%, Realty down by 1.60%, Auto down by 1.50%, Consumer Durables down by 1.35%, Telecom down by 1.25% were the losing indices on BSE. (Provisional)

The top gainers on the Sensex were Infosys up by 1.33%, Tech Mahindra up by 0.63%, Tata Motors up by 0.51%, Axis Bank up by 0.50% and TCS up by 0.42%. On the flip side, Mahindra & Mahindra down by 3.58%, Bajaj Finance down by 3.01%, Nestle down by 2.85%, Asian Paints down by 2.49% and Bharti Airtel down by 2.09% were the top losers. (Provisional)

Meanwhile, India’s services sector activity eased in the month of September, as new business, international sales and output all rose at the slowest rates since late-2023. According to the survey report, the seasonally adjusted HSBC India Services PMI Business Activity Index fell to 57.7 in September from 60.9 in August. Further, the HSBC India Composite PMI Output Index -- which measures both manufacturing and services -- also eased to 58.3 in September as against 60.7 in August.

The survey report noted that new business intakes expanded sharply at the end of the second fiscal quarter, but the pace of growth retreated to a ten-month low. The solid increase in services employment seen since May was extended to September. Service providers reported the recruitment of full- and part-time workers, with both permanent and temporary contracts being offered. 

On the price front, fierce competition somewhat restricted charge inflation across India's service economy in September. Output prices still rose, but did so to the smallest degree in over two-and-a-half years. Cost pressures were more pronounced in the Consumer Services segment, but it was in Finance & Insurance that the fastest rise in selling prices was recorded. As per the report, there was a general absence of capacity pressure at service providers in India. This was signaled by the seasonally adjusted Outstanding Business Index registering broadly in line with the no-change mark of 50.0.

The CNX Nifty ended at 25,014.60, down by 235.50 points or 0.93% after trading in a range of 24,966.80 and 25,485.05. There were 10 stocks advancing against 40 stocks declining on the index. (Provisional)

The top gainers on Nifty were Infosys up by 1.31%, ONGC up by 1.10%, HDFC Life Insurance up by 0.93%, Tech Mahindra up by 0.77% and Wipro up by 0.64%. On the flip side, Mahindra & Mahindra down by 3.59%, Bajaj Finance down by 2.99%, Nestle down by 2.87%, Hero MotoCorp down by 2.51% and BPCL down by 2.47% were the top losers. (Provisional)

European markets were trading mostly in green; France’s CAC rose 31.92 points or 0.43% to 7,509.70 and Germany’s DAX was up by 37.47 points or 0.2% to 19,052.88. On the flip side, UK’s FTSE 100 was down by 36.95 points or 0.45% to 8,245.57.

Asian markets settled mostly higher on Friday ahead to key US jobs report later in the day that could decide the path of US interest rates. Japanese shares gained after Japanese Prime Minister Shigeru Ishiba said he has asked ministers to formulate an economic relief package to ease the bite of inflation. Hong Kong shares rose followed by Chinese stimulus measures announced recently, while Chinese shares were closed for a week-long holiday. Although, some gains were limited as ongoing conflict between Israel and Iran heightened market uncertainty.