Market Commentary - End-Session
Barometers extend gains, Nifty above 24,800 mark; VIX drops to 13 As on : 22-Aug-24  17:39

The domestic stock market closed slightly higher today, driven by consumer durables and PSU banks. However, media and IT stocks pulled back. The Nifty50 ended above the 24,800 mark. Media and IT stocks, however, declined. Investors are now focused on U.S. economic data and Fed Chair Powell's speech for clues on potential interest rate cuts. A dovish Fed stance could stabilize the market as uncertainty decreases.

The barometer index, the S&P BSE Sensex rose 147.89 points or 0.18% to 81,053.19. The Nifty 50 index added 41.30 points or 0.17% to 24,811.50. The 50-unit index has risen 2.79% in six sessions.

Grasim Industries (up 2.63%), Bharti Airtel (up 1.51%) and ICICI Bank (up 1.38%) boosted the indices.

The broader market outperformed the frontline indices. The S&P BSE Mid-Cap index added 0.67% and the S&P BSE Small-Cap index gained 0.47%.

The market breadth was strong. On the BSE, 2,451 shares rose and 1,513 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, slipped 2.49% to 13.

Economy:

The India Services Purchasing Managers' Index (PMI) Business Activity Index inched up to 60.4 in August from 60.3 in July.

In contrast, the Flash India Manufacturing PMI Output Index dipped to 60.9 in August from 61.7 in July, while the Flash India Manufacturing PMI fell slightly to 57.9 from 58.1.

The India Composite PMI Output Index, which combines both manufacturing and services, edged down to 60.5 from 60.7 in the previous month.

The HSBC Flash India Services PMI rose to 60.4 in August from 60.3 in July.

Numbers to Track:

The yield on India's 10-year benchmark federal paper shed 0.01% to 6.966 as compared with previous close 6.967.

In the foreign exchange market, the rupee edged lower against the dollar. The partially convertible rupee was hovering at 83.9375, compared with its close of 83.9075 during the previous trading session.

MCX Gold futures for 5 September 2024 settlement lost 0.07% to Rs 71,355.

The US Dollar index (DXY), which tracks the greenback's value against a basket of currencies, was up 0.24% to 101.28.

The United States 10-year bond yield gained 1.27% to 3.825.

In the commodities market, Brent crude for October 2024 settlement rose 34 cents or 0.45% to $76.39 a barrel.

Global Markets:

European markets advanced while most Asian stocks ended higher on Thursday, as investors digested the Fed's latest comments, hoping for a rates cut in September.

Japan's stock advanced, supported by stronger-than-expected services sector data. The au Jibun Bank flash Japan manufacturing purchasing managers' index (PMI) rose to 49.5 in August from 49.1 in July.

On Wednesday, U.S. stock markets closed higher, extending a positive streak. The S&P 500 and the Nasdaq advanced for the ninth day in the last 10 trading sessions with the former gaining 0.42% and the tech-heavy Nasdaq adding 0.57%. The Dow Jones saw modest gain of 0.14%.

The minutes from the Federal Reserve's latest meeting reinforced expectations for a rate cut in September, with a majority of FOMC members indicating that such a move would be appropriate based on current economic indicators.

But optimism over a rate cut was offset by data showing a severe downward revision in U.S. payrolls data in the year to March 2024, drumming up concerns that a slowing labor market could spur a potential recession in the world's biggest economy. The Bureau of Labor Statistics revised down March 2024's employment gains by 818,000 positions earlier in the session, as part of the agency's annual benchmark review of payroll data.

Investors now eagerly await Federal Reserve Chair Jerome Powell's speech at the Jackson Hole Symposium on Friday.

Stocks in Spotlight:

Procter & Gamble Health shed 2.69% after the pharma company's net profit tumbled 43.73 % to Rs 16.78 crore in Q4 June 2024 as against Rs 29.82 crore recorded in Q4 June 2023. Revenue from operations slipped 5.74% year on year to Rs 283.88 crore during the quarter, owing to changes in the go-to-market model.

Awfis Space Solutions soared 9.5% after the company announced the launch of two new coworking spaces in Bengaluru, India. The centers are located in Mantri Commerce and Vista Pixel, and offer a combined total of 66,846 square feet of workspace. Both centers are located in prime locations with excellent connectivity to major business districts. They also offer a range of amenities, including advanced technology and facility management services.

Bartronics India surged 4.13% after announcing plans to acquire a stake in Ventugrow Consultants, an AI and Machine Learning-based investment advisory firm. Ventugrow Consultants, known for its 'Jarvis' brand, offers advanced financial technology solutions to B2B and B2C clients. The company reported revenues of Rs 1.05 crore in FY23 and Rs 1.03 crore in FY22.

Nucleus Software Exports dropped 6.43%. The company's board approved a share buyback aggregating upto Rs 72.35 crore at Rs 1,615 per share.

Indian Renewable Energy Development of India (IREDA) surged 7.64% after the company's board said that it will meet on 29 August 2024, to consider raising up to Rs 4,500 crore through different modes.

Zomato fell 0.83% and One97 Communication (Paytm) fell 3.33%. The company said that its board approved to enter into share purchase agreement (SPA) with Paytm, Wasteland Entertainment (WEPL) and Orbgen Technolgies (WEPL) to acquire their entertainment ticketing business.

Rail Vikas Nigam (RVNL) added 1.23%. The company said that it has signed a memorandum of understanding (MoU) with Dhaya Maju Infrastructure (Asia) Sdn Berhad (DMIA) to expand its operations into the ASEAN market.

GAIL (India) fell 0.93%. The company said that it has signed an MoU with Petron Scientech Inc to jointly explore setting up of a 500 Kilo Tons per Annum (KTA) bio-ethylene plant in India.

Aarti Drugs jumped 5.61% after the company said its board will consider a share buyback on Monday, 26 August 2024.

Welspun Enterprises advanced 1.57% after the company said that its material subsidiary, Welspun Michigan Engineers (WMEL) received letter of acceptance (LOA) from the Brihanmumbai Municipal Corporation (BMC), aggregating to Rs 159.75 crore.

Transformers and Rectifiers (India) (TRIL) hit an upper circuit of 5% after the company announced that it has bagged two export orders worth $16.80 million (approximatelty equal to Rs 141 crore).

IPO Update:

The initial public offer (IPO) of Orient Technologies received 12,62,82,744 bids for shares as against 74,49,846 shares on offer, according to stock exchange data at 17:00 IST on Thursday (21 August 2024). The issue was subscribed 16.95 times.

The issue opened for bidding on Wednesday (21 August 2024) and it will close on Friday (23 August 2024). The price band of the IPO is fixed between Rs 195 to Rs 206 per share. An investor can bid for a minimum of 72 equity shares and in multiples thereof.

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