Market Commentary - End-Session
Indices rise for 4th day, Nifty closes above 24,950 As on : 31-Jul-24  17:50

Domestic stocks closed higher today, extending their winning streak to four days. The market was buoyed by global optimism as investors await the US Fed's interest rate decision later today. At home, metals, pharma, and healthcare stocks climbed, while PSU banks and realty lagged.

The S&P BSE Sensex rose 285.94 points or 0.35% to 81,741.34. The Nifty 50 index added 93.85 points or 0.38% to 24,951.15. The 50-unit index is up 2.23% in four straight sessions.

JSW Steel (up 2.84%), Adani Ports & SEZ (up 1.56%) and ITC (up 1.03%) boosted the indices today.

In the broader market, the S&P BSE Mid-Cap index gained 0.86% and the S&P BSE Small-Cap index shed 0.14%. Both the indices hit record high levels today.

The market breadth was positive. On the BSE, 2121 shares rose and 1833 shares fell. A total of 83 shares were unchanged.

The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, advanced 3.26% to 13.30.

Economy:

India's fiscal deficit for the first quarter of the financial year 2024-25 narrowed significantly to 8.1% of the full-year estimate, compared to 25.3% in the same period last year. The Q1FY25 deficit amounted to Rs 1.36 lakh crore.

The total receipts of Rs 8.34 lakh crore was 27.1% of the year's budget target, while it was 22.1% during the same quarter of the previous year. The total expenditure of Rs 9.70 lakh crore was 20.4% of the year's budget target, while it was 23.3% during the same quarter of the previous year.

Finance Minister Nirmala Sitharaman has maintained the fiscal deficit target at 4.9% of GDP in the Union Budget 2024, a reduction from the 5.1% target in the interim budget. The government aims to further lower the deficit to 4.5% or below by FY26.

Sebi proposes stricter rules for index derivatives:

The market regulator is looking to curb speculation, protect investors, and stabilize the market by introducing measures like upfront option premiums, increased contract sizes, and restrictions on weekly index products.

Numbers to Track:

The yield on India's 10-year benchmark federal grew 1.67% to 7.047 as compared with previous close 7.050.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.7200, compared with its close of 83.7300 during the previous trading session.

MCX Gold futures for 5 August 2024 settlement rose 0.66% to Rs 69,061.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was down 0.41% to 104.12.

The United States 10-year bond yield fell 0.17% to 4.136.

In the commodities market, Brent crude for September 2024 settlement gained $1.67 or 2.12% to $80.30 a barrel.

Global Markets:

European stocks advanced on Wednesday. In July, the Euro Zone experienced an unexpected rise in headline inflation, increasing to 2.6% from 2.5% in June, according to a report released on Wednesday by the European Union's statistics agency.

Most Asian stocks settled higher. The Bank of Japan has raised its policy rate to 0.25% from it previous range of 0% to 0.1% and plans to cut its bond-buying program by 400 billion yen per quarter. From January to March 2026, the monthly purchases of Japanese Government Bonds (JGBs) will be reduced to 3 trillion yen, with a goal of decreasing the amount of JGBs bought in a predictable manner.

China's manufacturing sector contracted for a third straight month in July, as indicated by the Purchasing Managers' Index (PMI) data. Manufacturing PMI fell to 49.4 in July, data from the National Bureau of Statistics showed. This reflects persistent weakness in domestic demand despite government support measures.

US stocks declined on Tuesday, primarily due to a drop in Nvidia, ahead of the Fed meeting outcome on Wednesday. The S&P 500 fell by 0.5% while the tech-heavy Nasdaq Composite dropped roughly 1.3%. The Dow Jones Industrial Average rose 0.5%.

Market expectations are for the Fed to maintain interest rates later today, but to signal a potential rate cut in September. This outlook is driven by encouraging inflation data.

Stocks in Spotlight:

Mahindra & Mahindra shed 0.36%. The company reported 5% decline in standalone net profit to Rs 2,613 crore in Q1 FY25 as compared with Rs 2,759 crore posted in corresponding quarter last year. Revenue from operations jumped 11% YoY to Rs 27,133 crore in Q1 FY25.

Bharat Heavy Electricals (BHEL) declined 0.58%. The company reported consolidated net loss of Rs 211.40 crore in Q1 FY25 as comapred with net loss of Rs 204.70 crore recorded in Q1 FY24. Revenue from operations grew by 9.62% year on year (YoY) to Rs 5,484.92 crore in the quarter ended 30 June 2024.

Godrej Properties added 1.23% after the company reported its highest ever consolidated net profit of Rs 520.05 crore in Q1 FY25, steeply higher than Rs 124.94 crore posted in Q1 FY24. On the other hand, revenue from operations declined 21.05% year on year to Rs 739 crore in Q1 FY25 from Rs 936.09 crore recorded in the same period a year ago.

Zee Entertainment Enterprises (ZEEL) advanced 2.58% after the company reported a consolidated net profit (from continuing operations) of Rs 125.66 crore in Q1 FY25, steeply higher than Rs 3.87 crore in Q1 FY24. However, revenue from operations declined 6.89% to Rs 1,983.80 crore in Q1 FY25 as compared with Rs 2,130.53crore recorded in Q1 FY24.

GAIL (India) rallied 3.17% after the company's consolidated net profit jumped 77.54% to Rs 3,183.35 crore in Q1 FY25 as comapred with Rs 1,792.99 crore in Q1 FY24. Revenue from operations (excluding excise duty) increased 5.94% YoY to Rs 34,737.77 crore during the quarter.

IndiaMART InterMESH dropped 6.52%. The company reported 37% rise in consolidated net profit to Rs 114 crore on a 17% increase in operating revenue to Rs 331 crore in Q1 FY25 as compared with Q1 FY24.

Indus Towers slipped 3.18% to Rs 432.85. The telecom infrastructure provider's consolidated net profit climbed 42.88% to Rs 1925.9 crore in Q1 FY25 as against Rs 1,347.9 crore reported in Q1 FY24. Revenue from operations stood at Rs 7383 crore, up 4.34% from Rs 7075.9 crore recorded in the corresponding quarter previous year. Meanwhile, the company said that its board has approved a share buyback of upto Rs 2,640 crore at Rs 465 per equity share through tender offer route.

Rajratan Global Wire gained 4% after the company's consolidated net profit jumped 22.61% to Rs 15.24 crore in Q1 FY25 as compared with Rs 12.43 crore in Q1 FY24. Revenue from operations increased 7.99% YoY to Rs 220.14 crore during the quarter.

Automobile Corporation of Goa zoomed 17.53% after the company's standalone net profit jumped 77.33% to Rs 17.91 crore in Q1 FY25 as compared with Rs 10.10 core recorded in Q1 FY24. Revenue from operations increased 34.67% YoY to Rs 203.32 crore during the quarter.

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