Sensex, Nifty end lower for fifth straight session

Indian equity benchmarks ended lower for the fifth session in a row on Friday due to widespread selling pressure tracking muted earnings growth and global uncertainties. Markets opened flat but quickly slid into negative territory, amid massive foreign capital outflows. Foreign Institutional Investors (FIIs) offloaded equities worth Rs 5,062.45 crore on Thursday, according to exchange data. Traders were anxious as rating agency CRISIL stated that the revenue growth of Indian companies for the July-September quarter is estimated to be 5-7 per cent year-on-year (Y-o-Y), marking the slowest growth in 16 quarters. Some concern also came as Union Finance Minister Nirmala Sitharaman has stressed that job creation is the most critical issue worldwide, particularly given the persistent economic challenges and rapid technological advancements that are reshaping the labor market.

Markets continued downward trajectory in late afternoon session as sentiments remained down-beat with ratings agency ICRA’s report that the slew of regulatory measures and tighter funding conditions in the domestic markets to result in a steady slowdown in credit growth for the lenders, i.e. banks and non-bank financial companies (NBFCs). It estimates the incremental bank credit growth to slow down to Rs. 19.0-20.5 trillion in FY2025, which will translate into a YoY growth of around 12%, compared to Rs. 22.3 trillion in FY2024 (YoY growth of 16.3%). However, a slight bounce in the last hour helped trim some losses. Traders took some support with the report that government has doubled the loan limit under the Pradhan Mantri Mudra Yojana (PMMY) to Rs 20 lakh to promote entrepreneurship in the country. This increase aspires to further the overall objective of the Mudra Scheme which is funding the unfunded. This enhancement is specifically beneficial to upcoming entrepreneurs facilitating their growth and expansion. The move is in alignment with the government's commitment in fostering a robust entrepreneurial ecosystem.

On the global front, European markets were trading mostly in red as geopolitical tensions in the Middle East as well as election uncertainty in the U.S. weighed on market sentiment. Asian markets settled mixed on Friday ahead of elections in Japan over the weekend and uncertainty over the impact on Bank of Japan's monetary policy stance. Back home, on the sectoral front, pharma stocks were in focus as credit rating agency, India Ratings and Research’s (Ind-Ra) report stated that the Indian pharmaceutical market (IPM) continued to deliver mid-single digit growth for the last three consecutive months at 5.3% in September 2024. The report noted that this is because of price growth (5.3% yoy) and new launches (2.4% yoy). However, it said the volume growth (negative 2.4% yoy) remained weak.

Finally, the BSE Sensex fell 662.87 points or 0.83% to 79,402.29, and the CNX Nifty was down by 218.60 points or 0.90% to 24,180.80. 

The BSE Sensex touched high and low of 80,253.19 and 79,137.98 respectively. There were 9 stocks advancing against 21 stocks declining on the index.

The broader indices ended in red; the BSE Mid cap index fell 1.48%, while Small cap index was down by 2.44%.

The lone gaining sectoral index on the BSE was FMCG up by 0.50%, while Oil & Gas down by 3.09%, Consumer Durables down by 2.74%, Energy down by 2.66%, PSU down by 2.56% and Utilities down by 2.53% were the top losing indices on BSE.

The top gainers on the Sensex were ITC up by 2.17%, Axis Bank up by 1.69%, Hindustan Unilever up by 0.98%, Sun Pharma up by 0.53% and Kotak Mahindra Bank up by 0.47%. On the flip side, Indusind Bank down by 18.56%, Mahindra & Mahindra down by 3.93%, Larsen & Toubro down by 3.35%, NTPC down by 3.13% and Adani Ports & SEZ down by 2.79% were the top losers.

Meanwhile, the Cabinet Committee on Economic Affairs (CCEA) chaired by the Prime Minister Narendra Modi, has approved two projects of Ministry of Railways with total estimated cost of Rs 6,798 crore (approximately). Two approved projects are doubling of Narkatiaganj-Raxaul-Sitamarhi-Darbhanga & Sitamarhi-Muzaffarpur Section covering 256 kms; and construction of new line between Errupalem and Namburu via Amaravati covering 57 kms to be completed in 5years. The projects will generate direct employment for about 106 lakh human-days.

The doubling of Narkatiaganj-Raxaul-Sitamarhi-Darbhanga & Sitamarhi-Muzaffarpur Section will strengthen the connectivity to Nepal, North-east India and Border areas and facilitating movement of passenger trains along with goods train resulting in the socio-economic growth of the region. The new rail line project Errupalem-Amaravati-Namburu traverses through NTR Vijayawada and Guntur districts of Andhra Pradesh and Khammam district of Telangana. The Two projects covering 8 Districts in 3 States i.e., Andhra Pradesh, Telangana and Bihar will increase the existing network of Indian Railways by about 313 Kms. New Line project will provide connectivity to approximately 168 villages and about 12 lakh population with 9 new stations. Multi-tracking project will enhance connectivity to Two Aspirational Districts (Sitamarhi and Muzaffarpur) serving approximately 388 villages and about 9 lakh population.

These are essential routes for transportation of commodities such as agriculture products, fertilizer, coal, iron ore, steel, cement, etc. The capacity augmentation works will result in additional freight traffic of magnitude 31 MTPA (Million Tonnes Per Annum). The Railways being environment friendly and energy efficient mode of transportation, will help both in achieving climate goals and minimizing logistics cost of the country, lower CO2 emissions (168 Crore Kg) which is equivalent to plantation of 7 Crore trees. The new line proposal will provide direct connectivity to ‘Amaravati’ the proposed Capital of Andhra Pradesh and improve mobility for industries and the population, providing enhanced efficiency and service reliability for Indian Railways. The multi-tracking proposal will ease operations and reduce congestion, providing the much-required infrastructural development on the busiest sections across Indian Railways.

The CNX Nifty traded in a range of 24,440.25 and 24,073.90. There were 12 stocks advancing against 38 stocks declining on the index. 

The top gainers on Nifty were ITC up by 2.24%, Axis Bank up by 1.85%, Bharat Electronics up by 1.55%, Britannia Industries up by 1.24% and Hindustan Unilever up by 1.01%. On the flip side, Indusind Bank down by 18.99%, Adani Enterprises down by 4.90%, BPCL down by 4.82%, Shriram Finance down by 3.92% and Coal India down by 3.62% were the top losers.

European markets were trading mostly in red; UK’s FTSE 100 decreased 13.78 points or 0.17% to 8,255.60 and France’s CAC fell 14.41 points or 0.19% to 7,488.87, while Germany’s DAX gained 10.09 points or 0.05% to 19,453.09.

Asian markets settled mixed on Friday ahead of Japanese elections set to take place this weekend, while uncertainty over the US presidential election also kept sentiments mixed. However, Chinese shares gained ahead of the upcoming session of China's top legislature in the first week of November to discuss a wide range of issues facing the world’s second-largest economy. In South Korea, the Kospi marginally rose after tech gains on Wall Street, even with investors remaining concerned over a possible slower pace of the Federal Reserve's interest rate cuts.