Market Commentary - Mid-Session
Market trade with robust gains; European mkt opens lower As on : 26-Aug-24  13:35

The key equity indices continued to trade with major gains in afternoon trade. The Nifty traded above the 25,000 level. IT, consumer durables and oil & gas shares advanced while PSU bank, pharma and media shares declined.

At 13:30 IST, the barometer index, the S&P BSE Sensex jumped 655.27 points or 0.81% to 81,751.40. The Nifty 50 index advanced 200.05 points or 0.81% to 25,023.20.

In the broader market, the S&P BSE Mid-Cap index added 0.45% and the S&P BSE Small-Cap index gained 0.32%.

The market breadth was positive. On the BSE, 2,269 shares rose and 1,709 shares fell. A total of 160 shares were unchanged.

Economy:

India's forex reserves jumped by $4.546 billion to $674.664 billion during the week ended August 16, according to the latest RBI data.

In the previous week, the forex kitty had dropped by $4.8 billion to $670.119 billion. On August 2, the overall reserves hit an all-time high of $674.919 billion.

The foreign currency assets, a major component of the reserves, increased by $3.609 billion to $591.569 billion, the RBI data showed.

Gold reserves increased by $865 million to $60.104 billion during the week ended August 16. The special drawing rights (SDRs) were up by $60 million to $18.341 billion.

India's reserve position with the IMF was up by $12 million to $4.65 billion during the week, said the RBI.

Gainers & Losers:

NTPC (up 2.99%), Hindalco Industries (up 2.90%), Oil and Natural Gas Corporation (up 2.80%), HCL Technologies (up 2.26%) and Bajaj Finserv (up 2.05%) were major Nifty gainers.

Apollo Hospitals Enterprise (down 0.62%), Hero Motocorp (down 0.53%), Adani Ports and Special Economic Zone (down 0.44%), Adani Enterprises (down 0.42%) and Eicher Motors (down 0.40%) were major Nifty losers.

Stocks in Spotlight:

Shyam Metalics & Energy jumped 2.80% after the company's wholly-owned subsidiary, Shyam Sel and Power (SSPL) has acquired a 100% stake in SMEL Steel Structural, a promoter group company, for total consideration of Rs 1 lakh.

SSPL purchased 10,000 equity shares in SMEL Steel Structural, which were previously held by Sheetij Agarwal and Shubham Agarwal (5000 shares each).

KEC International gained 2.99% after the company said that it has secured new orders of Rs 1,079 crore in transmission & distribution (T&D) and cables businesses.

Alembic Pharmaceuticals fell 0.49% after the company announced that it has received final approval from the US Food & Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) Betamethasone Valerate Foam.

Symphony shed 0.57%. The household appliances company announced that its wholly owned subsidiary (WOS) in China, Guangdong Symphony Keruilai Air Cooling Co, has incorporated a China-based unit, Dongguan GSK Appliances.

Bharat Heavy Electricals (BHEL) rose 0.68%. The company announced that it has received orders worth over Rs 11,000 crore from Adani Power and its subsidiary Mahan Energen, to set up three supercritical thermal power projects.

Transport Corporation of India tumbled 4.54%. The company informed that its board approved share buyback of up to Rs 160 crore at a price of Rs 1,200 per equity share.

Shilpa Medicare jumped 4.91% after the company informed that it has successfully completed phase-3 clinical studies of its product SMLNUD07 - Nor Ursodeoxycholic Acid (NorUDCA) tablets.

Global Markets:

Europeans stocks traded lower on Monday, as investors digested increasing tensions in the Middle East following strikes by both Israel and Hezbollah over the weekend.

Asian markets traded mixed, with some finding support from the anticipation of lower U.S. interest rates. However, Japanese markets retreated amidst pressure from the yen and speculation about potential rate hikes by the Bank of Japan. The upcoming Tokyo inflation data is expected to provide more clarity on the trajectory of Japanese interest rates.

Sentiment was also influenced by the People's Bank of China's withdrawal of approximately 101 billion yuan ($14.2 billion) from the open market. While this move aimed to strengthen the yuan, it also raised concerns about the extent of Beijing's support for the Chinese economy.

Regional markets drew initial strength from the positive performance of Wall Street, where the S&P 500 and Dow Jones Industrial Average approached record highs on Friday. Federal Reserve Chair Jerome Powell's comments reinforced expectations for a rate cut in September, with Powell stating that the time has come for a monetary policy adjustment.

In his speech at the Jackson Hole Economic Symposium on Friday, Powell highlighted the factors contributing to recent inflation, including increased demand for goods, supply chain disruptions, tight labor markets, and rising commodity prices. He also clarified that the recent rise in the unemployment rate is primarily due to increased labor supply and slower hiring, rather than widespread layoffs.

The S&P 500 gained 1.2%, the Dow Jones Industrial Average rose 1.1%, and the NASDAQ Composite surged 1.5%.

However, caution prevailed ahead of a series of crucial events this week. The most anticipated is the earnings report from NVIDIA Corporation, a market darling, which is due after the market closes on Wednesday. Additionally, the PCE price index data, the Fed's preferred inflation gauge, is scheduled for later in the week.

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