Market Commentary - Mid-Session
Benchmarks trade with limited losses; European shares opened lower As on : 16-Dec-24  13:35

The key equity indices continued to trade with moderate losses in the afternoon trade. The Nifty traded below the 24,650 level. Realty, media and PSU bank shares advanced while metal, IT and oil & gas stocks corrected.

At 13:28 IST, the barometer index, the S&P BSE Sensex, dropped 455.58 points or 0.55% to 81,677.54. The Nifty 50 index fell 125.45 points or 0.51% to 24,642.85.

The broader market outperformed the frontline indices. The S&P BSE Mid-Cap index added 0.59% and the S&P BSE Small-Cap index rose 0.46%.

The market breadth was positive. On the BSE, 2,316 shares rose and 1,740 shares fell. A total of 119 shares were unchanged.

Economy:

The annual inflation rate based on the All India Wholesale Price Index (WPI) is 1.89% (provisional) for November 2024, compared to November 2023. The positive inflation rate in November 2024 is primarily due to an increase in prices of food articles, food products, other manufactured goods, textiles, machinery, and equipment.

The Food Index, consisting of 'food articles' from the primary articles group and 'food products' from the manufactured products group, decreased from 201.2 in October 2024 to 200.3 in November 2024. The rate of inflation based on the WPI Food Index decreased from 11.59% in October 2024 to 8.92% in November 2024.

The HSBC Flash India Composite Output Index registered a value of 60.7 at the end of December 2024. This marked an increase from the final reading of 58.6 in November, indicating the strongest growth rate observed in four months. The rise was driven by faster growth in both the manufacturing and services sectors.

The HSBC Flash India Manufacturing PMI stood at 57.4 in December as compared with 56.5 in November 2024, this pointed to an improvement in manufacturing sector conditions that was substantial and stronger than seen on average across the series history.

The HSBC Flash India Services PMI business was at 60.8 in December 2024 as against 58.4 in November 2024.

Meanwhile, India's foreign exchange reserves dropped by $3.235 billion to $654.857 billion, a five-month low, for the week ended December 6, data released by the Reserve Bank of India (RBI) revealed on Friday.

Foreign currency assets, a major component of the reserves, decreased by $3.228 billion to $565.623 billion for the week ended December 6, 2024, as per the data.

Gainers & Losers:

Dr. Reddy's Laboratories (up 1.90%), IndusInd Bank (up 1.37%), Bajaj Finance (up 0.55%), Cipla (up 0.44%) and Power Grid Corporation of India (up 0.36%) were major Nifty gainers.

Titan Company (down 1.93%), Ultratech Cement (down 1.48%), Bharat Petroleum Corporation (BPCL) (down 1.43%), Tata Consultancy Services (TCS) (down 1.28%) and Tech Mahindra (down 1.19%) were the major Nifty losers.

Stocks in Spotlight:

Rites advanced 2.41% after the company secured an order worth Rs 297.67 crore from the Ministry of External Affairs, Government of India.

HBL Power Systems gained 2.11% after the company has received an order worth Rs 1,522.40 crore from Chittaranjan Locomotive Works (CLW) for the supply, installation and commissioning of the KAVACH (Train Collision Avoidance System) equipment in locomotives.

JSW Energy advanced 1.66% after the company announced that it has secured multiple renewable energy (RE) projects in the commercial and industrial (C&I) power market.

Dixon Technologies (India) rallied 4.56% after the company signed a binding term sheet for setting up a new manufacturing joint venture with vivo Mobile India.

Global Market:

European and Asian stocks tumbled on Monday as investors readied themselves for the final full week of trading this year with a series of central bank meetings including the Fed, Bank of Japan and Bank of England.

South Korea's shares and the won rose after President Yoon Suk Yeol was impeached on the weekend.

Meanwhile, the au Jibun Bank Japan manufacturing PMI read 49.5 in the first two weeks of December, compared to expectations of 49.2. The reading improved from 49.0 seen in the prior month.

The au Jibun Bank Japan Services PMI rose to 51.4 in December from 50.5 in the prior month, pushing further into expansion territory.

A reading below 50 indicates contraction, with the manufacturing PMI now shrinking for a sixth straight month.

U.S. stocks witnessed a subdued session on Friday as recent economic data showed inflation remaining sticky in November- a trend that could limit the Fed's plans to lower interest rates.

The Fed is widely expected to cut interest rates by 25 basis points at the conclusion of a two-day meeting on Wednesday, after the central bank kicked off an easing cycle earlier in the year. The move will bring rates down by a total of 100 bps in 2024.

The Dow Jones Industrial Average fell 86.06 points, or 0.20%, to 43,828.06, the S&P 500 lost 0.16 point, or 0.00%, to 6,051.09 and the Nasdaq Composite gained 23.88 points, or 0.12%, to 19,926.72.

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