Market Commentary     02-May-24
Mid-Session
Benchmarks trade with small gains; Metal shares shine
The domestic equity indices continued to trade in positive terrain with minor gains in mid-morning trade. The Nifty traded above the 22,600 level. Metal shares advanced after declining in the past trading session. Trading could be a volatile due to the expiry of weekly index options on the NSE.

At 11:25 IST, the barometer index, the S&P BSE Sensex, advanced 109.37 points or 0.15% to 74,596.34. The Nifty 50 index added 35.85 points or 0.16% to 22,640.70

In the broader market, the S&P BSE Mid-Cap index rose 0.65% and the S&P BSE Small-Cap index added 0.26%.

The market breadth was positive. On the BSE, 1,931 shares rose and 1,605 shares fell. A total of 191 shares were unchanged.

Buzzing index:

The Nifty Metal index jumped 0.98% to 22,667.35. The index fell 1% in the past trading session.

Welspun Corp (up 3.62%), Hindustan Zinc (up 1.63%), Tata Steel (up 1.39%), Vedanta (up 1.23%), Adani Enterprises (up 1.22%), Hindustan Copper (up 1.17%), APL Apollo Tubes (up 1.08%), Jindal Steel & Power (up 0.99%), JSW Steel (up 0.94%) and Jindal Stainless (up 0.57%) advance.

On the other hand, Hindalco Industries (down 0.45%), Steel Authority of India (down 0.15%) and Ratnamani Metals & Tubes (down 0.15%) declined.

Economy:

Despite falling from 59.1 in March to 58.8 in April, the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) signalled the second-best improvement in the health of the sector for three-and-a-half years. The PMI was comfortably above both the neutral mark of 50.0 and its long-run average (53.9).

The Indian manufacturing sector started the first fiscal quarter in a high gear, according to the latest HSBC PMI data. . Firms experienced a sharp upturn in new business intakes, and scaled up production accordingly.

April's rise in raw material stocks was supported by a further increase in buying levels. Inputs were purchased to the greatest degree since June 2023. Another factor that facilitated this was suppliers' ability to deliver items in a timely manner. Vendor performance improved for the second straight month.

Pranjul Bhandari, Chief India Economist at HSBC, said: “On the price front, higher costs of raw materials and labour led to a modest uptick in input costs, but inflation remains below the historical average. However, firms passed these increases onto consumers through higher output charges, as demand remained resilient, resulting in improved margins."

Stocks in Spotlight:

Hero MotoCorp added 1.03% after the company said that it had sold 533,585 units of motorcycles and scooters in April 2024, which is higher by 34.7% as compared with sales of 396,107 units recorded in April 2023.

Ambuja Cements rose 0.37%. The cement major’s consolidated net profit surged 63.61% to Rs 1,055.16 crore in Q4 FY24 as against Rs 644.94 crore recorded in Q4 FY23. Revenue from operations was at Rs 8,893.99 crore in the March quarter, up 11.65% from Rs 7,965.98 crore posted in the same period last year.

Havells India rose 0.23%. The company’s consolidated net profit jumped 24.8% YoY to Rs 447 crore in Q4 FY24. Revenue jumped 12% to Rs 5,442 crore in Q4 FY24 as compared with Rs 4,859 crore in Q4 FY23.

Global Markets:

Asia-Pacific stock markets were mostly declined on Thursday, after the U.S. Federal Reserve opted to hold interest rates steady at the end of its two-day meeting.

Fed Chair Jerome Powell ruled out the possibility of a rate hike, easing worries over the central bank likely not being able to rein in inflation.

South Korea’s consumer prices rose at a slower pace in April from March on a year-on-year basis, according to official data. April CPI came in at 2.9% year on year, compared with a 3.1% rise in March. Core CPI, excluding food and energy prices, rose 2.3%. It was slightly slower than a 2.4% increase in March.

US stocks closed with a mixed performance on Wednesday following the Federal Reserve's decision to keep its key interest rate unchanged, as widely anticipated. The central bank indicated a potential rate cut in the future but expressed uncertainty regarding sustained progress on inflation.

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