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The Indian benchmarks witnessed substantial losses during the week, extending their losing streak for the third consecutive week. The indices were lower for three out of five trading sessions. The BSE Mid-Cap index and BSE Small-Cap index fell. In the week ended on Friday, 18 October 2024, the S&P BSE Sensex tumbled 156.61 points or 0.19% to settle at 81,224.75. The Nifty 50 index declined 110.20 points or 0.44% to settle at 24,854.05. The BSE Mid-Cap index fell 0.18% to close at 56,600.05. The BSE Small-Cap index declined 1.01% to end at 47,946.53. On economy front, India’s wholesale price index (WPI)-based inflation rose to 1.84% in September as food items, especially vegetables, turned costlier, as per the government data released on Monday.

The market ended the week with minor cuts, declining for the second straight week, with Nifty settling below the 25,000 level. The RBI Governor announced that the MPC decided to maintain repo rate at 6.5% and projected GDP growth at 7.2%, while shifting from a ‘withdrawal of accommodation’ to a ‘neutral’ policy stance. Titan reported 25% standalone revenue growth in Q2 FY25, while TCS’ net profit declined by 1.08%, and operational revenue increased by 2.63%. On the global front, the British economy rose by 0.2%, US CPI inflation eased to 2.4%, core CPI rose by 0.1%, and US jobless claims increased to 258,000.

The key equity indices ended the truncated week with significant losses amid heightened tensions in the Middle East, triggered by the Israel-Iran conflict. India’s fiscal deficit improved to 27% of the full-year target for April-August, down from 36% in FY24, while the HSBC Manufacturing PMI fell to 56.5 in September. Tata Motors reported an 11.52% sales decline, contrasting with Bajaj Auto’s 19.60% increase. In broader economic news, the British economy grew 0.5% in Q2, Germany’s inflation rate fell to 1.5%, China’s central bank plans to cut mortgage rates, and the US added 143,000 jobs in September, reflecting resilience in the job market.

The Indian frontline indices managed to end the week with decent gains as they continued to record new record highs during the week. The broader markets howeer remained under pressure during the period. The frontline gains was largely driven by the overall positive sentiment in the market. The key sectors contributing to the gains were Auto and Oil & Gas. The global markets also maintained a positive momentum, with the Asian indices being the star while the US markets made modest gains.

The Indian frontline indices witnessed significant gains, recording their all time high for the second straight week. The positive sentiment in the market was influenced by the Fed decision to cut rates by 50 bps.  However, significant selloff was also evident in the broader market largely due to the rising concerns of global slowdown. India’s WPI cooled to a four month low of 1.31% in August primarily due to decline in prices of manufactured goods and food items. The global markets remained largely positive during the week. The key highlight for the week would be the decision of rate cut by the Fed and BOJ’s decision to keep the rates unchanged.

Domestic barometers clocked strong gains, hitting fresh record highs during the week. The positive sentiment in the Indian market was likely influenced by the upbeat global market mood, fueled by expectations of interest rate cuts by major central banks. This global optimism provided a supportive backdrop for the domestic market. The domestic equity market edged higher in three out of five  trading sessions during this week. The Sensex closed above the 82,850 level and the Nifty settled above the 25,350 mark.

Domestic equity indices witnessed modest losses during the week, snapping a three-week rising streak. The Nifty slipped 383.75 points to at 24,852.15. The broader market continued to stage outperformance for yet another week. Meanwhile, HSBC India’s PMI for August was 57.5, down from July but above its long-term average. On the global front, China’s Caixin PMI fell to a six-month low of 49.1. South Korea’s headline inflation eased to 2%, its lowest since March 2021, while Japan’s household spending showed a modest 0.1% increase in real terms compared to the previous year. In the US, manufacturing continued to contract with the ISM PMI at 47.2, and job openings fell to 7.67 million, the lowest since early 2021, highlighting potential challenges for the economy.

During the week, India’s benchmark equity indices experienced a second consecutive week of losses due to global and domestic macroeconomic factors. Domestic shares tanked during the week, mirroring a global rout sparked by fears of a US recession. Worries over slowing economic growth, fuelled by weak US jobs data, sent market shockwaves. Additionally, the RBI decided to keep the repo rate unchanged at its August MPC meeting, reflecting India’s robust growth despite uncertainties in weather, geopolitics, and AI-driven tech disruptions. The benchmark was lower for three of five trading sessions: the BSE Mid-Cap index and BSE Small-Cap index skid. The Nifty settled below the 24,400 level. Sensex fails to hold 80,000 level. We expect volatility to continue in the near term amid persistent concerns over Middle East tensions, fears of a probable recession in the US and after-effects of the Yen carry trade unwinding.

Domestic equity indices continued their upward trajectory for the second consecutive week. The Nifty settled above the 24,800 level. The broader market outperformed the benchmark indices during the week.  Meanwhile, India’s foreign exchange reserves declined $4.8 billion to $670.119 billion for the week ended. In August, India’s Services PMI Business Activity Index slightly rose to 60.4, while the Composite PMI Output Index decreased to 60.5. On the global front, China’s lending rates stayed unchanged, Japan’s stock market gained on strong services data, and Japanese core CPI rose 2.7% YoY. The Fed’s meeting minutes suggested a September rate cut, but concerns over a revised U.S. payrolls data and a potential recession tempered optimism.

The stock indices experienced modest gains over the shortened week, breaking a two-week losing trend. The Sensex ended above 80,400, while the Nifty finished above 24,500. This recovery was driven by positive investor sentiment and selective buying in key sectors. Despite some volatility, the overall market trend was upward, reflecting renewed confidence among investors. The week also saw the release of important economic indicators, including the CPI at 3.54%, the WPI at 2.04%, as well as data on the trade deficit and IIP. For the past week, global markets experienced some notable gains on account of allayed fear of recession in the largest world economy driven by positive economic signals and overall stability in the market.