In the week ended on Friday, 14 June 2024, the S&P BSE Sensex gained 299.41 points or 0.39% to settle at 76,992.77. The Nifty 50 index rose 175.45 points or 0.75% to settle at 23,465.60. The BSE Mid-Cap index rallied 4.41% to close at 46,058.76. The BSE Small-Cap index jumped 5.07% to end at 51,199.99.

Weekly Index Movement:

Domestic stocks gave back some gains on Monday, snapping a 3-day winning streak. The barometer index, the S&P BSE Sensex, was down 203.28 points or 0.27% to 76,490.08. The Nifty 50 index shed 30.95 points or 0.13% to 23,259.20.

Key equity barometers ended flat on Tuesday. The S&P BSE Sensex fell 33.49 points or 0.04% to 76,456.59. The Nifty 50 index rose 5.65 points or 0.02% to 23,264.85.

Domestic stocks rose on Wednesday. The S&P BSE Sensex rose 149.98 points or 0.20% to 76,606.57. The Nifty 50 index climbed 58.10 points or 0.25% to 23,322.95.

Domestic shares notched another win on Thrusday, closing slightly higher for a two-day winning streak. The S&P BSE Sensex rose 204.33 points or 0.27% to 76,810.90. The Nifty 50 index rose 75.95 points or 0.33% to 23,398.90.

The domestic equity benchmarks ended with decent gains on Friday. The barometer index, the S&P BSE Sensex, was up 181.87 points or 0.24% to 76,992.77. The Nifty 50 index rose 66.70 points or 0.29% to 23,465.60.

Economy:

India's foreign exchange reserves surged to a new record high of $651.51 billion for the week ending May 31st, according to the Reserve Bank of India (RBI). This represents an increase of $4.837 billion from the previous week. The rise was primarily driven by a $5.065 billion increase in foreign currency assets, which are a major component of the reserves. However, there were also some declines, with gold reserves falling by $212 million and Special Drawing Rights (SDRs) decreasing by $17 million. India's reserve position with the IMF also saw a minor increase of $1 million.

India's annual inflation rate based on the Consumer Price Index (CPI) fell to 4.75% for the month of May 2024, according to government data. This is lower compared to 4.83% in April 2024 and 4.31% in May 2023. Inflation in the food basket remained high at 8.69% in May 2024, showing a slight decrease from 8.70% in April 2024.

India's industrial production showed strong growth of 5% in April 2024 compared to 4.6% in April 2023. The growth rates of the three sectors, Mining, Manufacturing and Electricity for the month of April 2024 over April 2023 are 6.7%, 3.9% and 10.2% respectively.

India’s annual rate of inflation based on all India Wholesale Price Index (WPI) number is 2.61% for the month of May 2024 (over May 2023), the Ministry of Commerce & Industry said in a statement on Friday. Positive rate of inflation in May 2024 is primarily due to increase in prices of food articles, manufacture of food products, crude petroleum & natural gas, mineral oils, other manufacturing etc. The month over month change in WPI index for the month of May 2024 stood at 0.20% as compared to April 2024.

India’s merchandise exports in May 2024 rose by 9% to USD 38.13 billion, from USD 34.95 billion in the year-ago month, according to government data released on Friday. Imports too increased by 7.7% to USD 61.91 billion, from USD 57.48 billion in May 2023. Trade deficit, or the gap between imports and exports, during the month under review stood at USD 23.78 billion.

Meanwhile, the World Bank predicts India will remain the fastest-growing major economy despite a projected slowdown. After a strong 8.2% growth in FY2023/24, the economy is expected to average 6.7% growth annually over the next three years. This moderation is mainly due to a decrease in investment growth, although it will still be higher than previously anticipated. The Indian economy is fueled by strong performance in manufacturing, construction, and services, which offset a slowdown in agriculture. Consumer spending is expected to rise as agricultural production recovers and inflation dips.

Stocks in Spotlight:

JSW Steel rose 0.84%. The company's consolidated crude steel production decreased 4% to 20.98 lakh tonnes in May 2024 as against 21.78 lakh tonnes recorded in May 2023.

Dr Reddy’s Laboratories addded 0.35%. The company said that US Food and Drug Administration (USFDA) issued form 483 with four observations post inspection at its Srikakulam, Andhra Pradesh manufacturing facility.

Meanwhile, the pharmaceuticals company said that its wholly owned subsidiary, Dr. Reddy’s USA and Ingenus Pharmaceuticals has entered into license agreement to commercialise Cyclophosphamide Injection RTD in United States (US).

State Bank of India (SBI) gained 1.24%. The bank's executive committee of its board approved raising upto $3 billion through issuance of senior, unsecured notes via public offer and private placement methods.

Mahindra & Mahindra advanced 2.45%. The company said that its total production jumped 17.48% to 69,886 units in the month of May 2024 as compared with 59,490 units produced in the same period last year.

Adani Enterprises rose 1.39%. The company announced that its defence subsidiary, Adani Defence & Aerospace has signed a milestone cooperation agreement with EDGE Group for combining their expertise in missiles, weapons, unmanned platforms, and cyber systems.

HDFC Life Insurance Company surged 3.28% after the company expressed its support for the progressive reforms outlined by the insurance regulator in its master circular on life insurance products. While HDFC Life anticipates a 100 basis point (bps) impact on its New Business Margin (NBM) due to the higher surrender values, the company remains confident in its ability to mitigate this impact and deliver long-term value to its customers.

Larsen & Toubro (L&T) rallied 4.35%. The company announced that its Hydrocarbon vertical, L&T Energy has secured a large offshore order from Oil & Natural Gas Corporation (ONGC).

Ambuja Cements added 8.84%. The company said it will acquire 100% stake in Penna Cement Industries (PCIL) for an enterprise value of Rs 10,422 crore.

Global Markets:

Japan's revised GDP data for the first quarter (ending March 31, 2024) revealed a contraction of 1.8% year-on-year. This is an improvement from the initial estimate of a 2.0% decline. However, it still signifies a significant slowdown compared to the 0.4% growth observed in the previous quarter. On a quarterly basis, Japan's GDP fell 0.5%, matching the initial estimate.

The Bank of Japan (BOJ) kept its benchmark interest rate unchanged at between 0% and 0.1% but indicated it’s considering the reduction of its purchase of Japanese government bonds after the next monetary policy meeting scheduled for 30 and 31 July 2024.

The robust U.S. jobs data, released by the Bureau of Labor Statistics (BLS) on Friday, showed the creation of 272,000 new jobs in May. This surpassed analyst forecasts and came after a revised figure of 165,000 jobs added in April. Additionally, average hourly earnings rose 0.4% in May, following a 0.2% increase in April. Year-on-year wage growth climbed to 4.1% in May, compared to the upwardly revised 4.0% reported in April. Generally, wage growth within a 3.0% to 3.5% range aligns with the Fed's 2% inflation target. The average workweek remained steady at 34.3 hours.

The release of May's US Consumer Price Index (CPI) and the Federal Reserve interest rate decision on Wednesday are crucial factors shaping market sentiment. The Fed is expected to maintain current interest rates, which are at a two-decade high.

The Federal Reserve maintained interest rates after its policy meeting, revising its forecast to one rate cut this year and four in 2025. This shift from the previous projection of three cuts in 2024 reflects a more cautious outlook.