The key equity benchmarks witnessed substantial gains during the week, rising for the fifth week in a row. The Nifty settled above the 24,300 level. The broader market outperformed the frontline indices during the period under review. Positive mood was supported by a variety of factors, including the return of monsoon rains, a rebound in manufacturing PMI, and anticipation of strong corporate earnings in Q1. The upcoming budget, with its potential for expanded PLI schemes in various sectors, further fueled optimism.
In the week ended on Friday, 5 July 2024, the S&P BSE Sensex advanced 963.87 points or 1.22% to settle at 79,996.60. The Nifty 50 index added 303.55 points or 1.26% to settle at 24,314.15. The BSE Mid-Cap index gained 2.77% to close at 47,437.85. The BSE Small-Cap index jumped 3.88% to end at 54,153.96.
Weekly Index Movement:
Monday's market saw a measured rise, closing the day with the Nifty50 above 24,100. In the barometer index, the S&P BSE Sensex was up 443.46 points or 0.56% to 79,476.19. The Nifty 50 index added 131.35 points or 0.55% to 24,141.95.
The equity benchmarks ended flat on Tuesday after early gains fizzled. In the barometer index, the barometer index, the S&P BSE Sensex was down 34.74 points or 0.04% to 79,441.45. The Nifty 50 index lost 18.10 points or 0.07% to 24,123.85.
Domestic shares surged on Wednesday, with the Sensex breaching the historic 80,000 mark and the Nifty settling above 24,250. In the barometer index, the S&P BSE Sensex was up 545.35 points or 0.69% to 79,986.80. The Nifty 50 index gained 162.65 points or 0.67% to 24,286.50.
The session started with a bang, echoing the bullish sentiment from the region on Thursday. While some profit taking emerged at higher levels, leading the benchmarks to settle near flat line with minimal gains. The S&P BSE Sensex added 62.87 points or 0.08% to 80,049.67. The Nifty 50 index rose 15.65 points or 0.06% to 24,302.15.
The key equity indices ended sideways on Friday. The S&P BSE Sensex was down 53.07 points or 0.07% to 79,996.60. The Nifty 50 index added 21.70 points or 0.09% to 24,323.85.
Economy:
The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) increased to 58.3 in June from 57.5 in May, thus indicating a sharper improvement in business conditions.
Further, the combined Index of Eight Core Industries (ICI) increased by 6.3% (provisional) in May, 2024 as compared to the Index in May, 2023. The production of Electricity, Coal, Steel, Natural Gas and Refinery Products recorded positive growth in May 2024.
Moreover, the India's fiscal deficit between April-May stood at around 3% of the overall target for FY25, at Rs 50,615 crore, down from 11.8% of the budget estimate in the corresponding period last year, according to the data released by the Controller General of Accounts.
The fiscal deficit stood at Rs 16.54 trillion in FY24, against the budgetary target of Rs 17.86 trillion. Aided by higher-than-expected tax receipts, the Union government contained the fiscal deficit at 5.6% of the gross domestic product (GDP) in 2023-24 (FY24), compared with the Revised Estimates of 5.8%.
The Centre has set an FY25 fiscal deficit target of 5.1%, or Rs 16.85 trillion, in order to achieve a fiscal deficit of 4.5% of GDP by FY26.
Meanwhile, India's foreign exchange reserves rose by $816 million to $653.71 billion in the week ending June 21st, reversing a decline from the previous week. This increase was driven by a rise in gold reserves ($988 million) while special drawing rights (SDRs) fell slightly ($57 million).
Further, the seasonally adjusted HSBC India Services Business Activity Index rose from 60.2 in May to 60.5, indicating a sharp expansion in output. The broader HSBC India Composite Output Index also climbed in June, reaching 60.9 from 60.5 in the previous month.
Stocks in Spotlight:
Larsen & Toubro rose 1.99%. The EPC major announced that its vertical, L&T Energy Hydrocarbon (LTEH) has secured a significant order from the Oil & Natural Gas Corporation (ONGC) for the eighth phase of pipeline replacement project (PRPVIII Group B) off India's west coast.
Eicher Motors added 1.08%. The vehicles manufacturer’s unlisted subsidiary, VE Commercial Vehicles (VECV) reported 10.55% year on year increase in commercial vehicles (CV) sales to 7,424 units in June 2024. The company informed that it has sold 73,141 motorcycle units in June 2024, which is lower by 5% as compared with 77,109 units in June 2023.
Bajaj Auto rose 1.46%. The company’s total sales in the month of June 2024 added up to 3,58,477 units, higher by 5% as compared with the sales figure of 3,40,981 units recorded in June 2023
Tata Motors added 0.31%. The firm said that its total domestic sales for June 2024 stood at 74,147 vehicles, registering de-growth of 8% compared to 80,383 units in June 2023.
Meanwhile, the auto major said that total Jaguar Land Rover (JLR) registrations in UK rose 5.28% to 6,421 units in June 2024 as compared with 6,099 units in June 2023.
Hero MotoCorp declined 0.53%. The two-wheeler major sold 5,03,448 units of motorcycles and scooters in June 2024, which is higher by 15.20% as compared with sales of 4,36,993 units recorded in June 2023.
Sun Pharmaceutical Industries gained 3%. The European Medicines Agency (EMA) validated the submission of the marketing authorization application (MAA) for Nidlegy made by the company, finalized on 3 June 2024.
Bajaj Finance added 0.26%. The company announced that its new loans booked increased by 10% to 10.97 million in Q1 FY25 compared to 9.94 million recorded in Q1 FY24.
HDFC Bank slipped 1.95%. The bank said that its gross advances aggregated to approximately Rs 24.87 lakh crore as of 30 June 2024, a growth of around 52.6% over Rs 16.30 lakh crore as of 30 June 2023.
Global Markets:
Japan's economy contracted more than expected in the first quarter of 2024, shrinking 2.9% year-on-year. This decline was primarily driven by a decrease in consumer spending amid stagnant wages and persistent inflation.
Japan's household spending dropped to 1.8% in May, falling short of expectations for a 0.1% gain. This metric is closely watched by the Bank of Japan as an indicator of a healthy economic cycle where wages and prices rise together.
The South Korea's inflation came in at 2.4% for June, slower than a rise of 2.7% in May and the slowest since July 2023.
China's Caixin Services PMI for June came in at 51.2, down from 54.0 in May. While still indicating expansion, the pace of growth has weakened.
The Commerce Department reported that US inflation in May slowed to its lowest annual rate in over three years. The core personal consumption expenditures price index, excluding volatile food and energy prices, rose just 0.1% in June and 2.6% year-over-year. However, consumer sentiment remained strong. The University of Michigan consumer sentiment index for June exceeded expectations, rising to 68.2 from a preliminary reading of 65.6. Additionally, the one-year inflation outlook dropped to 3% from 3.3% expected in May.