Nifty registers weekly declines led by concerns over corporate earnings!

Indian Developments

The Indian equity markets ended the week on a negative note pressured by selling in financials and energy stocks as concerns over corporate earnings dampened market sentiment. Benchmark equity indices Nifty 50 declined by 2.4% this week. Followed by Nifty midcap 150 which saw a sharp decline of 5.4% on week-on-week basis. Nifty SmallCap 250 too declined by 6.3% this week. The anticipation of muted corporate earnings dented investor sentiments. On a contrary note, India’s Industrial production numbers saw a significant improvement and increased to a 6-month high of 5.2% year-on-year growth.

Sectoral Developments

Sectoral indices saw a broad-based decline this week. Notably, sectors like Financial Services, Consumer durables, Reality and Banking saw sharper declines on week-on-week basis. On index levels Nifty Bank declined by 4.4%, Nifty Consumer durables declined by 6.1%, Nifty Financial Services excluding banking declined by 5.9%.

The Indian rupee touched a fresh record low of 86.1 per USD, pressured by a stronger dollar and higher US treasury yields. The currency has been under pressure in recent weeks due to a combination of domestic and international factors, despite efforts by the Reserve Bank of India to intervene in the foreign exchange market.

Global Developments

The global macroeconomic outlook reflects a cautiously optimistic environment. The dollar index remained steady above 109 with rising expectations for the December-2024 nonfarm payrolls report, seeking insights into the strength of the labour market. Brent crude futures rose over 2% to surpass $78.5 per barrel this week, reaching the highest level since October-2024, driven by a drop in US crude stockpiles and reduced supply from key exporters like Russia and Iran. In the U.S., Dow Jones, S&P 500 and Nasdaq, all, increased by 0.2%, 0.6% and 0.8% respectively, during the week. The Korean Index, KOSPI Index recorded gains of 3% whereas the Hang Seng index declined by 3.5%. NIKKEI also declined 1.7%.

Other Markets:

Brent crude prices increased to around $ 78 per barrel.

The rupee depreciated to above Rs 86 levels against the US dollar.

The Gold spot price stood at Rs 78,340 per 10 grams.

The 10 Year Benchmark G-Sec yield closed at 6.77% this week.

Source: www.nseindices.com; google finance, MCX Gold Prices; www.rbi.org.in; Morningstar and tradingeconomics.com, ccilindia.com

Data for week ended on January 10th , 2025

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