Weekly Market Review
The Indian benchmark indices continued to be volatile during the week, and it actually traded in the band of 23,816-24,500, which is nearly 650 points. As discussed in last week’s update, markets will be keeping a close watch on what happens globally, because we have a slew of major events lined up, and we will highlight all of them.
One of the most crucial was the U.S. Presidential Outcome. The Indian Market recorded significant gains driven by the positive sentiment following the news that Donald Trump is poised for a second term as U.S. President. All the global indices surged, fuelled by expectations of tax cuts and increased government spending under his administration.
Another key event from the market point of view was the outcome of the FOMC meeting, and the governor delivered no surprise as we had a 25 bps cut, which was obviously what the consensus estimates were.
In fact, the memorable part of the meeting was not about Monetary questions or guidance etc., but it was, of course, about the election. Fed Chair Jerome Powell was asked whether he would resign if asked by Trump, and he basically replied ‘No’, and this is something which is making headlines.
Otherwise, Powell’s comments were largely dovish, and there was nothing really to indicate that they were changing course as they wanted to get to the neutral rate as far as inflation was concerned.
FIIs have been relentless sellers, and this week as well they sold more than Rs 16,000 crore in the cash market. How much more selling is the question which we don’t have answers to, but there is some indication that maybe this goes for a bit longer and towards the end of the year, that gets exhausted, and then there is new allocation to emerging markets and this will give us a fresh view of what the FIIs want to do.
So far, the selling of around Rs 4,500-5,000 crore daily is absorbed but that is not letting the markets rise or do its own thing.
Remember, when the market faces challenges, a disciplined approach with a long-term perspective has always proven to be the best strategy!
With this, let me present to you our weekly portfolio review.
How Did the Markets Fare Last Week?
On a weekly basis, which ended on Friday, the Indian benchmark indices ended in red. Sensex and Nifty were down between 0.3 per cent-0.6 per cent, while Midcaps were down 0.4 per cent.
What Might Keep the Markets Busy Into the Next Week?
The coming week will be very data heavy both globally as well as locally. On the global front, we have various Fed officials’ speeches after the FOMC meeting held last week, so it will be important to gauge their perception on the macro front. Apart from this, we also have data points like the Consumer Price Index (CPI), Monthly Budget Statement, Producer Price Index (PPI), Initial Jobless Claims etc.
On the domestic front, we, too, have our CPI numbers due for October, Industrial & Manufacturing Output for September, WPI & Trade Deficit, and Foreign Exchange Reserves. We will also be tracking the remainder of quarter two earnings as well. These data points will keep investors busy.
Crude and FII Flows
Brent crude oil prices traded above $75/bbl supported by the Fed’s rate cut and falling Dollar Index, which increases the appeal of the non-interest-bearing precious metal.
On the other hand, FIIs continue to be net sellers for the week.
Sector in Focus
IT, PSU Banks & Auto remained in focus during the week.
FIIs have been relentless sellers, and this week as well they sold more than Rs 16,000 crore in the cash market.
Stocks that made headlines during the week
Hindustan Aeronautics:
The company has informed exchanges that a contract has been awarded to HAL for Avionics Upgrade of Dornier-228 Transport Aircraft, for enhancing IAF’s operational capability.
Since the upgrade involves most of the indigenously designed and developed avionics sub-systems, it marks a significant step towards “Atmanirbhar Bharat Abhiyan”.
DCX Systems:
The Company has received export orders from M/s. Lockheed Martin Global Inc, USA for USS 54,798,120.00 translating to Rs 460.30 crore at exchange rate of 1 USD = Rs 84. The order includes the supply of electronic assemblies. The timeline to execute the said orders is within 12 months.
Tata Motors:
Tata Motors consolidated revenue stood at Rs 1 lakh crore, down 3 per cent YoY, EBITDA margin was also down 230bps at 11.4 per cent. Management says growth in the quarter was impacted due to significant external challenges Overall, the business fundamentals remain strong, and they remain focused on driving growth, competitiveness and free cash flows.
As the supply challenges ease and demand picks up, Tata Motors remains confident of steady improvement in performance and delivering a strong H2FY25.
Map My India:
The Board has approved the incorporation of a Joint Venture (JV) Company in Indonesia between the Company and Hyundai AutoEver (wholly owned subsidiary of Hyundai Motor Company), Korea with the name PT Terra Link Technologies with an initial capital of USD 10 Million and the Company has approved the investment of USD 4 Million for acquiring 40 per cent stake in proposed JV.
Whirlpool:
The Board approved the expansion of the manufacturing capacity of Refrigerators at Pune factory by 3 lakh units on an annual basis. Currently, the capacity stands at 54 lakh units on an annual basis, with capacity utilisation of approx. 63 per cent. The rationale behind this expansion is to augment production capacity to meet future demand. The proposed expansion is expected to be completed by July 2026 in a phased manner.
Inox India:
INOX India (INOXCVA) announced the securing of a significant contract from Highview Power, UK for their upcoming Liquid Air Energy Storage (LAES) facility at Carrington, Manchester, UK. Under the contract, INOXCVA will supply 5 Vertical 690kl, high pressure EN Design Vacuum Insulated Cryogenic Tanks for the project.
Wipro:
Wipro and Google Cloud announced the launch of Wipro’s Google Gemini Experience Zone, a new in-person experience where Wipro customers can see the power of Google’s AI technologies and work with Wipro to identify the optimal generative AI use cases for their businesses.
Reliance Power:
The company has received a notice from Solar Energy Corporation of India Limited (SECI) whereby it was directed that the company, including its subsidiaries, stand debarred from participating in all future tenders issued by SECI for a period of 3 years from the date of issuance of the notice, i.e., 6th November 2024.
Brigade Enterprises:
The company has signed a Joint Development Agreement for developing a residential project of around one million square feet located at West Chennai. The project will be developed as part of a 1.5 million square feet mixed use development. the Gross Development Value of the project is about Rs 800 crore.
Gensol Engineering:
Gensol Engineering announced that its solar EPC order book is Rs 5,424 crore. This substantial figure includes solar projects from both Public Sector Undertakings (PSUs) and private clients, to be executed within a timeline of 12 to 18 months. In addition to the above, Gensol has a strong bid pipeline that far surpasses the current orderbook.
Apart from the solar order book, Gensol has secured orders for Battery Energy Storage Systems (BESS) under the BOO model, thereby boosting its revenue potential and reinforcing its commitment to advancing renewable energy, addressing the intermittent nature of the renewable energy (RE) sector, which is close to Rs 5,000 crore.
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