BAROMETERS INCH UP DESPITE EARLY DIP, BUDGET HOPES FUEL SECTORAL CHURN

Domestic stocks clawed their way back after a shaky start today, closing with modest gains. The Nifty 50 even dipped to 23,350 in early trade but recovered by midday, fueled by auto, consumer durables, and FMCG stocks. Sectoral shuffling was seen as investors weighed pre-budget expectations and hunted for bargains. The Sebi`s probe into Quant Mutual Fund cast a minor shadow, but overall, the mood was cautiously optimistic.

The barometer index, the S&P BSE Sensex, was up 131.18 points or 0.17% to 77,341.08. The Nifty 50 index rose 36.75 points or 0.16% to 23,537.85.

M&M (up 2.69%), ICICI Bank (up 1.03%) and HDFC Bank (up 0.40%) boosted the indices.

The broader market outperformed the frontline indices. The S&P BSE Mid-Cap index rose 0.37% and the S&P BSE Small-Cap index added 0.27%.

The market breadth was positive. On the BSE, 2,107 shares rose and 1,890 shares fell. A total of 159 shares were unchanged.

The NSE`s India VIX, a gauge of the market`s expectation of volatility over the near term, jumped 6.65% to 14.06.

Sebi Probes Quant MF:

Indian watchdog Sebi is probing Quant Mutual Fund, a fast-growing investment firm, for possible front-running. Front-running involves using insider knowledge on client trades for personal gain. Sebi`s surveillance system flagged suspicious trading patterns between Quant and other entities, prompting search and seizures. Quant says they`re cooperating with the investigation and committed to transparency.

Economy:

India`s forex reserves dipped $2.9 billion to $652.9 billion in the week ending June 14th, according to the RBI. This follows a record high of $655.8 billion the prior week. The decline is mainly due to a $2.1 billion drop in foreign currency assets, now at $574.2 billion.

Gold reserves also fell by $1.0 billion to $55.96 billion. Special Drawing Rights (SDRs) decreased by $54 million to $18.1 billion. However, India`s reserve position with the IMF rose $245 million to $4.6 billion.

Numbers to Track:

The yield on India`s 10-year benchmark federal shed 0.06% to 6.969 as compared with previous close 6.973.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 83.4850, compared with its close of 83.5700 during the previous trading session.

MCX Gold futures for 5 August 2024 settlement rose 0.16% to Rs 71,697.

The US Dollar index (DXY), which tracks the greenback`s value against a basket of currencies, was down 0.20% to 105.59.

The United States 10-year bond yield grew 0.07% to 4.261.

In the commodities market, Brent crude for August 2024 settlement gained 21 cents or 0.25% to $85.45 a barrel.

Global Markets:

The Dow Jones index futures were up 135 points, indicating a positive opening in the US stocks today.

European stocks advanced on Monday, as investors look ahead to fresh economic data and interest rate decisions from the region.

Most Asian stocks ended lower with Chinese markets leading the decline. This drop was fueled by concerns of a potential trade war with the European Union.

The European Union`s decision earlier in June to impose hefty tariffs on Chinese electric vehicles sparked tensions. Beijing reacted strongly, raising the possibility of a retaliatory trade war. Reports also suggested that China might impose tariffs on European automobiles in response.

In the US, the S&P 500 closed slightly lower on Friday, extending a two-day decline for tech giant Nvidia. The broad market index fell 0.16% to finish at 5,464.62, while the Nasdaq Composite dipped 0.18% to settle at 17,689.36. The Dow Jones Industrial Average edged up 15.57 points, or 0.04% to close at 39,150.33.

Stocks in Spotlight:

Ujjivan Small Finance Bank dropped 5.19% after the bank revised its loan book growth guidance for FY2024-25 downwards to 20% from nearly 25% announced earlier. The bank also expects the credit costs for FY25 to be 1.7% as against the earlier guided range of 1.4% to 1.5%. The deposit growth is expected to be in line with asset growth. While net interest margin (NIM) is to remain stable at around 9%, return on equity (RoE) is anticipated to be at 20% in FY25. The SFB had previously guided for an RoE of 22% for FY25.

Tide Water Oil (India) zoomed 5.91% after the company�s committee of directors approved a proposal from joint promoter Standard Greases & Specialities to acquire an additional 351,000 shares (representing 2.01% equity) of the company.

Route Mobile surged 14.29% after announcing a partnership with Billeasy E Solutions to extend Whatsapp-based ticket booking feature for Nagpur, Pune and Hyderabad metros in addition to Delhi. The company has become the largest enabler of WhatsApp based Metro rail ticket booking in India, serving over 75 lakh commuters each day.

Welspun Specialty Solutions zoomed 11.60% after the firm has been selected as L1 bidder by Bharat Heavy Electricals (BHEL) for supply of stainless steel boiler tubes to National Thermal Power Corporation (NTPC)�s thermal power project.

Larsen & Toubro (L&T) rose 0.34%. The company announced that its power transmission & distribution (PT&D) business has secured a significant domestic order to build Solar PV Plant along with a Battery Energy Storage System (BESS).

Lupin rose 0.42% after the company announced that it has received an Establishment Inspection Report (EIR) from the United States Food and Drug Administration (USFDA) for its manufacturing facility in Somerset at New Jersey.

Rail Vikas Nigam (RVNL) gained 1.66% after the company emerged as lowest bidder (L-1) for an EPC project from South Eastern Railway worth Rs 191.53 crore.

Biocon shed 1%. The company said that its subsidiary Biocon Biologics has received approval from the European Medicines Agency (EMA) to manufacture biosimilar Bevacizumab at its new multi-product monoclonal antibodies (mAbs) drug substance facility at Bengaluru.

Zee Media Corporation rose 0.21%. The company said that its board will meet on 26 June 2024 to consider raising funds by way of issuance of equity shares or any other eligible securities through various modes.

IPO Update:

The initial public offer (IPO) of Stanley Lifestyles received 5,31,98,840 for shares as against 1,02,41,507 shares on offer, according to stock exchange data at 17:00 IST on Monday (24 June 2024). The issue was subscribed 5.19 times.

The issue opened for bidding on Friday (21 June 2024) and it will close on Tueday (25 June 2024). The price band of the IPO is fixed between Rs 351 to Rs 369 per share. An investor can bid for a minimum of 40 equity shares and in multiples thereof.

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