Market Commentary     12-Jun-24
Mid-Session
Broader market outperforms; European mrkt opens higher
The frontline indices continued to trade with modest gains in afternoon trade. The Nifty hovered above the 23,350 mark. Media, oil & gas and PSU bank shares advanced while FMCG and realty shares declined.

At 13:30 IST, the barometer index, the S&P BSE Sensex was jumped 406.63 points or 0.54% to 76,862.63. The Nifty 50 index gained 128.85 points or 0.55% to 23,393.70.

The Nifty 50 hit an all-time high at 23,441.95 in mid-morning trade.

The broader market outperformed the headline indices. The S&P BSE Mid-Cap index rose 1.16% and the S&P BSE Small-Cap index gained 0.91%.

The market breadth was strong. On the BSE, 2,543 shares rose and 1,272 shares fell. A total of 118 shares were unchanged.

Economy:

India will remain the fastest-growing of the world’s largest economies, although its pace of expansion is expected to moderate, the World Bank said in its latest biannual Global Economic Prospects. After a high growth rate in FY2023/24, steady growth of 6.7% per year, on average, is projected for the three fiscal years beginning in FY2024/25. Growth is estimated to have picked up to 8.2% in fiscal year (FY) 2023/24 (April 2023 to March 2024)—1.9% points higher than estimated in January.

Growth in industrial activity, including manufacturing and construction, was stronger than expected, alongside resilient services activity, which helped offset a slowdown in agricultural production partly caused by monsoons. Growth of domestic demand remained robust, with a surge in investment, including in infrastructure, offsetting a moderation of consumption growth as postpandemic pent-up demand eased.

Meanwhile, the moderation is mainly due to a slowdown in investment from a high base, the Bank stated. However, investment growth is still expected to be stronger than previously envisaged and remain robust over the forecast period, with strong public investment accompanied by private investment. Private consumption growth is expected to benefit from a recovery of agricultural production and declining inflation. Government consumption is projected to grow only slowly, in line with the government’s aim of reducing current expenditure relative to GDP.

Gainers & Losers:

Coal India (up 3.16%), Power Grid Corporation of India (up 3.11%), Eicher Motors (up 2.05%), LTIMindtree (up 1.91%) and Tech Mahindra (up 1.73%) and were major Nifty gainers.

Britannia Industries (down 1.30%), Hindustan Unilever (down 1.12%), Titan Company (down 0.68%), Mahindra & Mahindra (down 0.66%) and Tata Consumer Products (down 0.37%) were major Nifty losers.

Stocks in Spotlight:

HCL Technologies rose 0.75%. The IT firm said that it has expanded its strategic partnership with Olympus Corporation to enable advanced and affordable healthcare for patients through new engineering technologies.

Meanwhile, the IT giant has signed a deal worth $278 million with Germany's largest cooperative primary bank — Deutsche Apotheker-und Ärztebank eG (apoBank).

TVS Supply Chain Solutions rallied 5.17% after the company announced that it has secured a new 5-year strategic contract with Daimler Truck South East Asia for providing integrated supply chain solutions (ISCS) service in Singapore.

Rites advanced 1.29% after the firm signed a memorandum of understanding (MoU) with the Eastern Railway’s Andal Diesel Shed, Asansol division in West Bengal for Loco maintenance.

Glenmark Pharmaceuticals (Glenmark) added 0.41%. The company announced that it has received a final approval from the United States Food and Drug Administration (USFDA) for Esomeprazole Magnesium delayed-release capsules.

B L Kashyap and Sons rose 0.69%. The firm received letter of intent (LoI) for two orders aggregating up to Rs 1,021 crore.

Global Markets:

European stocks advanced while Asian stocks traded mixed on Wednesday as jitters from US inflation data and the upcoming Federal Reserve decision weighed on markets. The Fed's monetary policy remains a key concern for Asian investors, even with Southeast Asian currencies facing important support levels.

Despite US indices closing at record highs on Tuesday, fueled by Apple's surge, investor focus shifted to today's events. The release of May's Consumer Price Index (CPI) and the Federal Reserve interest rate decision are crucial factors shaping market sentiment. The two-day Fed meeting is expected to maintain current interest rates, which are at a two-decade high.

The S&P 500 gained 0.3% and the Nasdaq jumped 0.9% on Tuesday, with Apple reaching an all-time high. The Dow Jones, however, shed 0.3%.

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