Nifty slides below 24,050 mark; European mkt tumbles

The key equity indices continued to trade in narrow range with deep cuts in afternoon trade. The decline was driven by a global market sell-off amid concerns about a potential slowdown in U.S. economic growth. The Nifty traded below the 24,050 mark. All the sectoral indices on NSE were in the red with realty, metal and PSU bank shares loosing the most.

At 13:30 IST, the barometer index, the S&P BSE Sensex slumped 2,283.01 points or 2.82% to 78,698.94. The Nifty 50 index tanked 682.95 points or 2.76% to 24,034.75.

The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index dropped 3.74% and the S&P BSE Small-Cap index tumbled 4.16%.

 

The market breadth was weak. On the BSE, 539 shares rose and 3,487 shares fell. A total of 104 shares were unchanged.

Economy:

The seasonally adjusted HSBC India Services Business Activity Index was at 60.3 in July, down only fractionally from 60.5 and above the neutral mark of 50.0 for the thirty-sixth straight month. The latest reading was more than six points higher than its long-run average and highlighted a substantial upturn in business activity.

The HSBC India Composite Output Index posted 60.7 in July, down only fractionally from 60.9 in June and above the crucial 50.0 no-change mark for the thirty-sixth month running. Hence, the latest reading signaled a continuation of the strong growth momentum seen recently. As has been the case since February, the manufacturing industry led the upturn.

Total new work rose sharply and at a pace that was considerably above its long-run average. Manufacturers experienced the stronger increase in new orders, despite a slowdown in its rate of expansion. Meanwhile, job creation remained solid across the two segments.

Worryingly, charged inflation climbed to a near 11-and-a-halfyear high in July amid stronger increases at goods producers and service providers. Input cost inflation also ticked higher in July, but remained below its long-run average. Manufacturing firms reported stronger cost pressures than their services counterparts.

Indias foreign exchange reserves registered a decline of $3.471 billion, reaching $667.386 billion during the week ended July 26, according to the latest data from the Reserve Bank of India (RBI).

Gold reserves fell by $2.297 billion to $57.695 billion during the week. Special drawing rights (SDRs) decreased by $5 million to $18.202 billion.

Indias reserve position with the International Monetary Fund (IMF) saw a modest increase of $2 million, reaching $4.612 billion in the reporting week.

Gainers & Losers:

Britannia Industries (up 1.17%), Hindustan Unilever (up 0.44%) and Nestle India (up 0.09%) were major Nifty gainers.

Tata Motors (down 6.67%), Adani Ports and Special Economic Zone (down 6.43%), Adani Ports and Special Economic Zone (down 5.89%), Tata Steel (down 4.70%) and Maruti Suzuki India (down 4.64%) were major Nifty losers.

Adani Ports and Special Economic Zone declined 6.43%. The companys total cargo volume for the month of July 2024 was 37.3 MMT, which is higher by 9.7% as compared with the same period last year.

Stocks in Spotlight:

Titan Company slipped 2.41% after the company reported marginal decline in standalone net profit to Rs 770 crore in Q1 FY25 as against Rs 777 crore posted in Q1 FY24. Revenue from operations jumped 9.92% year on year (YoY) to Rs 11,105 crore in the quarter ended 30 June 2024.

LIC Housing Finance tumbled 7.77% after the company's standalone net profit shed 1.77% to Rs 1,300.21 crore in Q1 FY25 as against with Rs 1,323.66 crore in Q1 FY24. Total income rose marginally to Rs 6,783.69 crore in June 2024 quarter from Rs 6,746.55 crore posted in same quarter last year.

Delhivery declined 2.08%. The logistics solution provider reported a consolidated net profit of Rs 54.36 crore in Q1 FY25 as against a net loss of Rs 89.48 crore posted in Q1 FY24. Revenue from operations grew by 12.57% year on year to Rs 2,172.3 crore in the quarter ended 30 June 2024.

Arrow Greentech hit an upper circuit of 20% after the companys consolidated net profit surged to Rs 20.15 crore in Q1 FY25 as compared wth Rs 9.34 crore recorded in Q1 FY24. Revenue from operations climbed 50.72% year on year to Rs 66.11 crore in the quarter ended 30 June 2024.

Devyani International declined 2.89%. The company has reported a consolidated net profit of Rs 22.4 crore in Q1 FY25 as against a net loss of Rs 1.6 crore in Q1 FY24. Revenue from operations increased by 44% year-over-year to Rs 1,221.9 crore in the June24 quarter.

Affle (India) slipped 2.56%. The companys consolidated net profit surged 30.84% to Rs 86.59 crore on 27.77% jump in revenue from operations to Rs 519.50 crore in Q1 FY25 over Q1 FY24.

Global Markets:

European and Asian markets plunged on Monday as fears of a deepening US recession gripped investors worldwide. Concerns that the Federal Reserve may be lagging in cutting interest rates exacerbated the sell-off.

Japan bore the brunt of the decline, with the Nikkei 225 and Topix indices plummeting as much as 7% in volatile trading.

The Reserve Bank of Australia is set to announce its interest rate decision today.

A weaker-than-expected US jobs report for July fueled recession fears, sending US stocks tumbling on Friday. The S&P 500 dropped 1.84%, the Nasdaq Composite lost 2.43%, and the Dow Jones Industrial Average fell 1.51%.

The report revealed that US nonfarm payrolls increased by only 114,000 in July, one of the weakest figures since the pandemic. Job growth was revised downward for the previous two months. The unemployment rate unexpectedly rose to 4.3%, surpassing the Federal Reserves year-end forecast and triggering a recession warning.

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