Post Session: Quick Review

Indian equity benchmarks witnessed bloodbath on Thursday’s trading session, with both the Sensex and the Nifty ending lower by over 2.50%, as bears held a tight grip over the Dalal Street. The start of the trading day was in deep red, as the United Nations said India is expected to grow 6.4% in 2022, well below the 8.8% growth in 2021, as higher inflationary pressures and uneven recovery of the labour market are likely to curb private consumption and investment.

Besides, the United Nations significantly lowered its forecast for global economic growth this year from 4% to 3.1%, saying the war in Ukraine has triggered increasing global food and commodity prices and exacerbated inflationary pressures, upending the fragile recovery from the COVID-19 pandemic. Adding more worries, a private report stated that equity investors became poorer by over Rs 5 lakh crore in early trade on Thursday as domestic benchmark indices tumbled mirroring weak trends in global equities.

Indices remained lower during the entire trading session. Traders were worried with continues selling by foreign institutional investors (FIIs). FIIs have been net sellers for eight straight months, and have dumped equities worth nearly Rs 38,000 crore in the month of May so far. Adding more pessimism, India Ratings and Research said the average headline inflation is set to accelerate to a nine-year high at 6.9 per cent in FY23, and the Reserve Bank may go for more rate hikes during the fiscal.

On the global front, European markets were trading lower as investors fret over the impact of the prolonged Ukraine-Russia war, higher interest rates and China's zero-COVID policy on global growth. Asian markets settled mostly lower, after Japan posted a merchandise trade deficit of 839.2 billion yen in April, the Ministry of Finance said on Thursday. That beat expectations for a shortfall of 1,150 billion yen following the downwardly revised 414.1 billion yen deficit in March (originally a 412.4 billion yen deficit).

The BSE Sensex ended at 52792.23, down by 1416.30 points or 2.61% after trading in a range of 52669.51 and 53356.04. There were 3 stocks advancing against 27 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 2.66%, while Small cap index down by 2.29%. (Provisional)

The top losing sectoral indices on the BSE were IT down by 5.25%, TECK down by 5.11%, Metal down by 4.23%, Telecom down by 3.46% and Basic Materials down by 2.81%, while there were no gaining sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were ITC up by 3.43%, Dr. Reddy's Lab up by 0.82% and Power Grid Corp up by 0.29%. On the flip side, Wipro down by 6.21%, HCL Tech. down by 6.01%, Infosys down by 5.46%, TCS down by 5.17% and Tech Mahindra down by 5.07% were the top losers. (Provisional)

Meanwhile, emphasizing that the revolutionary PM GatiShakti initiative would help solve the problem of haphazard development of infrastructure in the country, Union Minister of Commerce and Industry, Consumer Affairs, Food and Public Distribution and Textiles, Piyush Goyal has said that it will help build a secure, sustainable, scalable and collaborative approach towards infrastructure planning.

The Minister further expressed confidence that Information Technology and last mile digital connectivity will have an impact on every sector and would be the foundation of India's growth story in the years to come. He added that Digital India would form the foundation for Aatmanirbhar Bharat.

The Minister underlined the momentous role that digital connectivity had played in combating the COVID-19 pandemic by enabling quick and easy access to health infrastructure and other support systems the world over. He expressed his appreciation for the rapid pace at which education went online during the pandemic and switched over to edtech. The Minister also highlighted that India had earned the title of being a trusted partner to the world by not letting down a single international commitment.

The CNX Nifty ended at 15809.40, down by 430.90 points or 2.65% after trading in a range of 15775.20 and 15984.75. There were 3 stocks advancing against 47 stocks declining on the index. (Provisional)

The top gainers on Nifty were ITC up by 3.32%, Dr. Reddy's Lab up by 0.61% and Power Grid Corp up by 0.18%. On the flip side, Wipro down by 6.25%, HCL Tech. down by 5.99%, Infosys down by 5.44%, Tech Mahindra down by 5.43% and TCS down by 5.42% were the top losers. (Provisional)

European markets were trading lower, UK’s FTSE 100 decreased 154.00 points or 2.07% to 7,284.09, France’s CAC decreased 107.42 points or 1.69% to 6,245.52 and Germany’s DAX was down by 247.42 points or 1.77% to 13,760.34.

Asian markets settled mostly lower on Thursday following a massive sell-off on Wall Street overnight amid growing worries of an economic slowdown. Meanwhile, missed earnings expectations of US retail giants such as Target Corp and Walmart Inc by wide margins, added to fears of a recession. Japanese shares declined as Japan’s April exports growth data fell short of expectations. However, Chinese shares ended with marginal gains amid signs of easing Covid-19 restrictions in the world’s second largest economy.

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