Domestic equity benchmarks ended almost flat today, a breather after a two-day slump. IT stocks led the charge, while metals took a beating post the Supreme Court’s tax royalty verdict. Investors are now eyeing US CPI data for inflation clues, which could influence the Fed’s rate decision and, in turn, global markets.
The S&P BSE Sensex rose 149.85 points or 0.19% to 79,105.88. The Nifty 50 index added 4.75 points or 0.02% to 24,143.75.
Divis Laboratories (down 4.05%), Adani Enterprises (down 1.69%) and ICICI Bank (down 0.53%) were major drags.
The broader market underperformed the headline indices. The S&P BSE Mid-Cap index shed 0.41% and the S&P BSE Small-Cap declined 0.57%.
The market breadth was weak. On the BSE, 1442 shares rose and 2485 shares fell. A total of 109 shares were unchanged.
The NSE’s India VIX, a gauge of the market’s expectation of volatility over the near term, slipped 4.40% to 15.46.
NSE weekly index options contracts expired today due to the Independence Day holiday on Thursday.
Economy:
Indias wholesale price index (WPI)-based inflation for the month of July eased to 2.04% on an annual basis. In June, WPI inflation was at a 16-month high of 3.36%, driven by costlier food items.
India’s merchandise exports in July dipped 1.2% to $33.98 billion (Rs 2.85 lakh crore) from $34.39 billion (Rs 2.87 lakh crore) in the year-ago month, according to government data released on Wednesday. Imports increased by about 7.45 per cent to $57.48 billion (Rs 4.82 lakh crore) in July against $53.49 billion (Rs 4.49 lakh crore) a year ago. The trade deficit, or the gap between imports and exports, during the month under review stood at $23.5 billion (Rs 1.9 lakh crore).
Numbers to track:
The yield on India’s 10-year benchmark federal paper was down 0.43% to 6.975 as compared with previous close 7.005.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.9450, compared with its close of 83.9700 during the previous trading session.
MCX Gold futures for 5 September 2024 settlement added 0.28% to Rs 70,900.
The US Dollar index (DXY), which tracks the greenback’s value against a basket of currencies, was down 0.09% to 102.47.
The United States 10-year bond yield shed 0.63% to 3.833.
In the commodities market, Brent crude for October 2024 settlement slipped 27 cents or 0.33% to $80.42 a barrel.
Global Markets:
European shares advanced on Wednesday as investors analyse key inflation prints from the U.K. The U.K. CPI rose to 2.2% in July 2024, up from 2% in June 2024. On a monthly basis, CPI fell by 0.2% in July 2024, compared with a fall of 0.4% in July 2023.
Most Asian stocks ended higher, buoyed by Wall Street’s rally following upbeat US inflation data. This strengthened expectations that the Federal Reserve could initiate monetary easing as early as September.
New Zealand’s dollar tumbled after the central bank unexpectedly cut interest rates by 25 basis points to 5.25%.
Chinese equities declined as data revealed a contraction in bank loans to the real economy for the first time in 19 years. Investors are eagerly awaiting earnings results from Tencent Holdings and details of its planned share buyback.
US stocks surged on Tuesday, nearing recent record highs, after a milder-than-expected producer price index (PPI) report. The Dow Jones Industrial Average gained 1.04%, the Nasdaq Composite jumped 2.43%, and the S&P 500 climbed 1.68%.
The PPI, a measure of wholesale inflation, rose 0.1% last month. This data buoyed investor sentiment ahead of Wednesday’s more closely watched consumer price index (CPI) report, which is expected to show a modest increase of 0.2% month-over-month.
Stocks in Spotlight:
Major metals and mining stocks including Tata Steel, NMDC, Vedanta, Hindustan Zinc and Coal India fell as much as 5 percent after the Supreme Court allowed states to levy tax and royalty on minerals, apart from Central duties, and also allowed states to collect past dues. A nine-judge Constitution Bench of the Supreme Court on August 14 delivered a crucial judgment on tax on mining companies, ruling that states can collect previous dues on royalty and tax on mineral bearing land from April 1, 2005.
Hero MotoCorp slipped 3.18%. The two-wheeler major’s standalone net profit increased 36.12% to Rs 1,122.63 crore on 15.7% rise in revenue from operations to Rs 10,143.73 crore in Q1 FY25 over Q1 FY24.
Mazagon Dock Shipbuilders rallied 3.40% after the companys consolidated net profit zoomed 121.45% to Rs 696.10 crore in Q1 FY25 from Rs 314.34 crore reported in Q1 FY24. Revenue from operations grew by 8.48% to Rs 2,357.02 crore in Q1 FY25 as compared with Rs 2,172.76 crore recorded in the corresponding quarter previous year.
Mahindra & Mahindra lost 1.02%. The company said that its total production declined 1.18% to 69,138 units in the month of July 2024 as compared with 69,962 units produced in the same period last year.
Dishman Carbogen Amcis dropped 12.14%. On a consolidated basis, Dishman Carbogen Amcis reported net loss of Rs 77.57 crore in Q1 June 2024 as against net profit of Rs 17 crore in Q1 June 2023. Net sales declined 27.59% year-on-year to Rs 523.78 crore in Q1 June 2024. Net revenue was impacted mainly due to lower revenue in Switzerland and Netherlands.
Piramal Enterprises tumbled 10.59% after the company reported 64.33% fall in consolidated net profit to Rs 181.48 crore in Q1 FY24 as against Rs 508.78 crore in Q1 FY24. Total income fell 25.99% to Rs 2,145.38 crore in Q1 FY25 compared with Rs 2,898.79 crore in corresponding quarter last year.
Nazara Technologies declined 1.91%. The gaming and sports media company’s consolidated net profit (from continuing operations) increased 13.23% to Rs 23.62 crore in Q1 FY25 from Rs 20.86 crore in Q4 FY23. Revenue from operations stood at Rs 250.08 crore in Q1 FY25, down 1.71% from Rs 254.43 crore reported in the same period a year ago.
Hindustan Aeronautics declined 0.8%. The aerospace and defence companys consolidated net profit surged 76.5% to Rs 1,437.16 crore in Q1 FY25 as against Rs 814.24 crore posted in Q1 FY24. Revenue from operations was at Rs 4,347.50 crore in Q1 FY25, up 11.04% as against Rs 3,915.35 crore recorded in Q1 FY24.
FSN E-Commerce Ventures (Nykaa) advanced 1.4% after the company reported a consolidated net profit of Rs 13.64 crore in Q1 FY25, steeply higher than Rs 5.42 crore posted in Q1 FY24. Revenue from operations grew at a healthy pace of 23% year on year to Rs 1,746.11 crore in Q1 FY25.
Gabriel India rallied 4.2% after the companys standalone net profit jumped 20.43% YoY to Rs 51.16 crore in Q1 FY25. Revenue from operations increased 7.26% to Rs 864.23 crore in Q1 FY25 as compared with Rs 805.76 crore in Q1 FY24.
EPL zoomed 12.03% after the companys consolidated net profit jumped 18.23% to Rs 64.20 crore in Q1 FY25 as against 54.30 crore posted in Q1 FY24. Revenue from operations grew by 10.67% year on year to Rs 1,007.4 crore in the quarter ended 30 June 2024.
Landmark Cars dropped 5.88% after the companys consolidated net profit dropped 54.84% to Rs 3.17 crore in Q1 FY25 as compared with Rs 7.02 crore in Q1 FY24. Revenue from operations jumped 19.89% YoY to Rs 831.97 crore in Q1 FY25.
IPO Update:
The initial public offer (IPO) of Saraswati Saree Depot received 1,07,39,74,680 bids for shares as against 100,00,800 shares on offer, according to stock exchange data at 17:00 IST on Wednesday (14 August 2024). The issue was subscribed 107.39 times.
The issue opened for bidding on 12 August 2024 and it will close on 14 August 2024. The price band of the IPO was fixed at Rs 152 to 160 per share.
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