The key equity indices continued to trade with major losses in early afternoon trade. The Nifty tanked below the 23,700 level after hitting the day's high of 24,089.95 in the early trade. Metal shares slipped after advancing in the past two consecutive trading sessions.
Investors turned cautious after the first human metapneumovirus (HMPV) case being detected in Bengaluru amid reports of a virus outbreak in China.
At 12:30 IST, the barometer index, the S&P BSE Sensex, tumbled 1,030.86 points or 1.30% to 78,195.85. The Nifty 50 index declined 322.35 points or 1.34% to 23,682.80.
The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index shed 1.84% and the S&P BSE Small-Cap index slipped 2.49%.
The market breadth was weak. On the BSE, 758 shares rose and 3,194 shares fell. A total of 143 shares were unchanged.
Economy:
The seasonally adjusted HSBC India Services Business Activity Index rose from 58.4 in November to 59.3 in December, highlighting the strongest rate of expansion in four months.
At 59.2 in December, up from 58.6 in November, the HSBC India Composite Output Index signaled the strongest rise for four months. Private sector companies in India posted a faster increase in output at the end of the calendar year. The acceleration was driven by service providers, who recorded a quicker increase in business activity when factory production growth softened.
Ines Lam, economist at HSBC, said: 'India's service companies expressed strong optimism in December as business activity growth surged to a four-month high. Forward-looking indicators such as new business and future activity suggested that the strong performance will likely continue in the near future. The easing of input price inflation in the month also supported business sentiment. Strength in the services PMI stands in contrast with the growing signs of a slowdown in the manufacturing industry.'
India's foreign exchange (forex) reserves declined by $4.112 billion to an eight-month low of $640.279 billion during the week ended December 27, according to the latest RBI data.
For the week ending December 27, foreign currency assets, a major component of the reserves, decreased by $4.641 billion to $551.921 billion.
Gold reserves increased by $541 million to $66.268 billion during the week. The special drawing rights (SDRs) were down by $12 million to $17.873 billion, according to the RBI.
India's reserve position with the IMF was unchanged at $4.217 billion in the reporting week, the apex bank data showed.
Derivatives:
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, soared 12.96% to 15.30. The Nifty 30 January 2025 futures were trading at 23,787.60, at a premium of 104.8 points as compared with the spot at 23,682.80.
The Nifty option chain for the 30 January 2025 expiry showed maximum Call OI of 48.7 lakh contracts at the 25,000 strike price. Maximum Put OI of 52.2 lakh contracts was seen at 24,000 strike price.
Buzzing Index:
The Nifty Metal index declined 2.70% to 8,494.15. The index rose 2.65% in the past two consecutive trading sessions.
Hindustan Copper (down 4.32%), Tata Steel (down 4.29%), Hindustan Zinc (down 3.55%), Welspun Corp (down 3.35%), Adani Enterprises (down 3.14%), Steel Authority of India (down 3.12%), NMDC (down 3.09%), National Aluminium Company (down 2.88%), Vedanta (down 2.83%) and Hindalco Industries (down 2.61%) declined.
Stocks in Spotlight:
HDFC Bank slipped 1.87%. The bank's average deposits stood at Rs 24,52,700 crore as of 31st December 2024, registering the growth of around 15.9% as compared with Rs 21,17,100 crore as of 31st December 2023
L&T Finance declined 3.50%. The company said that its retail disbursements for Q3 FY25 was at Rs 15,170 crore, registering a growth of around 4% as against Rs 14,531 crore recorded in Q3 FY24.
FSN E-Commerce Ventures (Nykaa) gained 4.07% after the firm stated that it has witnessed a strong performance with consolidated net revenue growth likely to be higher than mid-twenties in the third quarter of FY25.
Kotak Mahindra Bank declined 2.79% after the bank's chief operating officer (COO) and chief technology officer (CTO), Milind Nagnur, tendered his resignation from the services of the bank due to personal reasons.
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