Market Commentary - End-Session
Sensex tanks 1064 pts, Nifty ends below 24,350; NSE VIX jumps to 14.49 As on : 17-Dec-24  17:05

The domestic equity benchmarks continued their downward spiral on Tuesday, marking their second consecutive day of significant losses. The Nifty closed below the 24,350 mark, dragged down by heavyweights like Reliance Industries, TCS, and HDFC Bank. PSU banks, metals, and energy stocks witnessed significant declines.

Investors adopted a cautious stance ahead of a crucial week of central bank meetings. While the US Federal Reserve is widely expected to implement a 25 basis point rate cut, concerns persist about the potential for hawkish undertones in the Fed's commentary. The Bank of Japan and the Bank of England are anticipated to maintain their current interest rate policies.

Adding to the market's woes, the Indian Rupee hit a new all-time low, intensifying economic pressures alongside a record-high trade deficit. Persistent FII outflow has further eroded market sentiment.

The S&P BSE Sensex tumbled 1,064.12 points or 1.30% to 80,684.45. The Nifty 50 index dropped 332.25 points or 1.35% to 24,336.

TCS (down 2.07%), Reliance Industries (down 1.81%) and HDFC Bank (down 1.71%)

The broader market outperformed the frontline indices. The S&P BSE Mid-Cap index fell 0.65% and the S&P BSE Small-Cap index shed 0.52%.

The market breadth was weak. On the BSE, 1,576 shares rose and 2,442 shares fell. A total of 89 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, rallied 3.31% to 14.49.

Economy:

India's merchandise trade deficit hit an all-time high of $37.84 billion in November, soaring widely from $27.1 billion in October, amid a spike in import bill. Surging gold imports and falling exports also had an impact. Petroleum product exports contracted sharply by 49.7% to $3.72 billion in November 2024.

Numbers to Track:

The yield on India's 10-year benchmark federal grew 1.96% to 6.873 as compared with the previous close of 6.851.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 84.9050 compared with its close of 84.9100 during the previous trading session.

MCX Gold futures for 5 December 2024 settlement shed 0.46% to Rs 76,710.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.21% to 107.08.

The United States 10-year bond yield rose 0.49% to 4.420.

In the commodities market, Brent crude for February 2025 settlement declined 61 cents or 0.83% to $73.30 a barrel.

Global Markets:

The Dow Jones index futures were down 134 points, signaling a negative opening for U.S. stocks today.

Most European stocks advanced while most Asian shares ended lower on Tuesday as investors awaited a crucial week for central bank policy decisions. The U.S. Federal Reserve is widely expected to cut rates on Wednesday, while the Bank of Japan is likely to maintain its current stance.

This week sees policy meetings from central banks in the United States, Japan, the UK, Sweden, Norway, Indonesia, and Thailand. The Bank of England, Norges Bank, and Bank of Thailand are anticipated to hold rates steady, while the Riksbank might opt for a rate cut. Bank Indonesia is expected to raise rates to support the weakening rupee currency.

Data released on Monday revealed a steeper than expected slowdown in China's consumer spending during November, negatively impacting stocks. Retail sales rose only 3% year-on-year, which is the weakest growth in three months and significantly lower than October's 4.8% increase.

In the US, major US technology stocks continued their upward momentum on Monday, propelling the Nasdaq Composite to record highs. However, the Dow Jones Industrial Average lagged behind, reflecting ongoing investor uncertainty about economic policies under the new administration.

The S&P 500 rose 0.38% to 6,074.10 points, while the NASDAQ Composite surged 1.24% to a record high of 20,204.58 points. The Dow Jones Industrial Average fell 0.25% to 43,717.48 points.

The chip sector experienced a rally, mirroring Broadcom Inc.'s continued gains fueled by strong earnings and guidance related to artificial intelligence. The prospect of lower interest rates in the near future also boosted other prominent tech companies like Apple, Amazon, and Alphabet.

Stocks in Spotlight:

HDFC Bank fell 1.71%. The lender got a warning letter from the markets regulator, Sebi, alleging its disclosures regarding the resignation of a senior employee, Arvind Kapil, were non-compliant with certain provisions.

Tata Motors shed 0.68%. The company reported that Uttar Pradesh State Road Transport Corporation (UPSRTC) had placed its third order of the year for 1,297 bus chassis, amounting to a cumulative order size of more than 3,500 units.

Oriana Power surged 10% after the company signed an Memorandum of Understanding (MoU) with Government of Rajasthan for various renewable energy projects worth Rs 10,000 crore.

Asian Energy Services gained 1.25% after the company bagged contract worth Rs 200 crore from Assam Gas Company for supplying compressor station on build, own, operate, and transfer (BOOT) basis for 3 years.

Balaji Telefilms dropped 7.07% after the company said that its board will meet on Thursday, 19 December 2024, to consider raising funds by issuance of various instruments through permissible modes.

Tarc hit a lower circuit of 10% after Securities and Exchange Board of India (SEBI) has appointed forensic auditor to investigate the financial statements of the company for FY21 to FY23, citing potential impact on investors interest.

Oriana Power hit an upper circuit of 10% after the company signed a Memorandum of Understanding (MoU) with Government of Rajasthan for various renewable energy projects worth Rs 10,000 crore.

RMC Switchgears hit an upper circuit of 5% after the firm received a letter of acceptance (LOA) from a reputed system integrator for the supply, installation and commissioning of 5,000 solar pumps in Maharashtra valued at Rs 90 crore.

Reliance Power declined 1.06%. The company announced that its subsidiary, Reliance NU Suntech received the letter of award (LoA) for 930 MW and 465 MW/1860 MWh battery energy storage systems (BESS) project from Solar Energy Corporation of India (SECI).

Genesys International Corporation rallied 6.62% after the firm received a project worth Rs 56 crore from Directorate of Land Records and Surveys (DLRS), West Bengal to improve the state's land records using advanced geospatial technology.

Everest Industries slipped 0.74% after the company informed that Pramod Nair, chief financial officer (CFO) has resigned from his position with effect from the close of working hours on 10 January 2025, to pursue opportunities outside the company.

PNB Gilts slipped 4.77% after the company informed that Vikas Goel has tendered his resignation from the position of managing director & CEO of the company on 16 December 2024.

NITCO jumped 4.91% and Prestige Estate projects added 1.20% after the company has secured Rs 105.40 crore order from Prestige Estates Projects for the supply of tiles, marble, and mosaic.

Indoco Remedies added 1%. The firm received official action indicated (OAI) status from the USFDA for plant II & plant III facility located at Verna Industrial Estate Area, Goa, India.

Hindustan Construction Company (HCC) dropped 4.75%. The company informed that its board has approved the opening of issue of qualified institutional placement (QIP) of equity shares with the floor price of Rs 45.27 per equity share.

Texmaco Rail & Engineering rose 0.83% after the company secured an order worth Rs 187.41 crore from Chhattisgarh State Power Transmission for construction of nine No.132 KV transmission lines on turnkey basis.

IPO Update:

The initial public offer (IPO) of International Gemmological Institute (India) received bids for 1,97,82,61,810 shares as against 5,85,60,902 shares on offer, according to stock exchange data at 17:00 IST on 17 December 2024. The issue was subscribed to 33.78 times.

The issue opened for bidding on 13 December 2024 and it will close on 17 December 2024. The price band of the IPO is fixed between Rs 397 and Rs 417 per share. An investor can bid for a minimum of 35 equity shares and in multiples thereof.

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