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Benchmark equity indices fell by more than 2% as investors’ optimism was dented after the Fed hinted at higher interest rate for a longer period and elevated crude oil prices. In addition, investors booked profits after the markets rallied for the past three weeks. For the week, the Sensex tumbled 2.7% to 66,009.15 and the Nifty 50 index tanked 2.57% to 19,674.25.
In broader markets, the BSE Midcap index fell 1.71% to 31,948.76. The BSE Smallcap index lost 2.04% to close at 37,057.48.
Top losers were Realty [-4.34%], Metal [-3.89%], Private Bank [-3.61%], Healthcare [-3.49%], Pharma [-3.3%]. Top gainer was PSU Bank [3.35%] and the rest of the Nifty sectoral indices closed in the red.
During the week, FIIs were net sellers for Rs 8,681.3 crore and DIIs were net buyers for Rs 1,939 crore in the cash segment.
The Indian rupee rose by 18 paise to 82.93 against the US dollar on Friday. Crude oil prices were trading above $90 per barrel. WTI Crude prices stood at $90.03 a barrel and Brent Crude was at $93.27 a barrel.
Company News
HDFC Bank: Brokerage firm Nomura has downgraded the lender’s rating to neutral from its earlier rating of buy. It has also cut the lender’s price target to Rs 1,800 from Rs 1,970 earlier. The brokerage firm cited four negative surprises after the HDFC Bank-HDFC merger for its downgrade that include lower net interest margin, higher cost-to-income ratio, uptick in non-performing assets. Shares of the company plunged 7.95% during the week.
HDFC Bank said that the RBI has approved the re-appointment of Sashidhar Jagdishan as the managing director (MD) and chief executive officer (CEO) of HDFC Bank for three years starting from October 27, 2023.
Infosys: The IT major has joined hands with NVIDIA to develop generative AI applications and solutions. The partnership brings together Nvidia AI Enterprise and Infosys Topaz, which an AI suite of services that was introduced earlier this year. Infosys plans to set up an NVIDIA Centre of Excellence, where it will train and certify 50,000 of its employees on NVIDIA AI technology.
Infosys will offer its Finacle Digital Banking Suite – Infosys Finacle, a part of EdgeVerve Systems, to Nigeria’s Guaranty Trust Bank, the banking subsidiary of Guaranty Trust Holding Company Plc. Guaranty Trust Bank will use Infosys Finacle for its multi-country digital transformation program.
Reliance Industries (RIL): The company’s telecom arm, Reliance Jio, has launched the Jio AirFiber and its related services in eight metro cities that include Ahmedabad, Bengaluru, Chennai, Delhi, Hyderabad, Kolkata, Mumbai, and Pune.
Tata Consultancy Services (TCS): The IT major said that it has entered into a strategic partnership with BankID BankAxept AS, Norway’s national payment and electronic identity systems, to set up and manage an operations command center that will enhance the resilience, security and availability of the country’s critical financial infrastructure. As part of the agreement, TCS will build and manage a 24×7 operations command center at Oslo, Norway, for all BankID BankAxept AS users and clients. The new command center will enable immediate responses to any service disruption, security issues, or client requests that are related to Norway’s essential national payments and electronic identity verification systems.
Biocon: The biopharmaceuticals company has received the approval from its board for the appointment of Peter Bains as the Group Chief Executive Officer (CEO), with effect from September 18. He will be reporting directly to Biocon Group Chairperson, Kiran Mazumdar-Shaw. Bains has stepped down from his role on the Biocon board as an Independent Director with immediate effect, to assume this strategic executive responsibility.
Wipro: The IT company announced that Jatin Pravinchandra Dalal has resigned as Chief Financial Officer of the company, with effect from November 30, to pursue other career opportunities. The company has appointed Aparna C Iyer as Chief Financial Officer, effective immediately. Aparna will report to CEO Thierry Delaporte and will join the Wipro Executive Board.
Tata Motors: The automaker shall increase the prices of commercial vehicles by up to 3% starting from October 1, 2023, to offset the residual impact of past input costs and will be applicable across the entire range of commercial vehicles.
Adani Green Energy (AGEL): The company and TotalEnergies have entered into a binding agreement to create a new JV, equally owned by TotalEnergies and AGEL, with a 1,050 MW portfolio. The portfolio will comprise a mix of already operational (300 MW), under construction (500 MW) & under development assets (250 MW) with a blend of both solar & wind power. AGEL will contribute to the JV the assets and TotalEnergies an equity investment of 300 MUS$ which will further support their development.
Bajaj Finserv: The financial services company has allotted 50,000 secured redeemable non convertible debentures (NCDs) with a face value of Rs 1,00,000 each, aggregating up to Rs 500 crore on private placement basis.
SJVN: The company announced that it has signed a memorandum of understanding (MoU) with PFC for financial assistance to various diversified portfolio of projects. The projects include renewable energy projects and thermal generation projects and total project cost of setting up the same is about Rs 1,18,826 crore. “The term loan financial assistance is tentatively proposed at 70% of the project cost, which may be increased for renewable energy projects as per project requirements,” SJVN said in a statement.
Glenmark Pharmaceuticals: The drug maker has entered into a definitive agreement with Nirma to divest 75% stake in its subsidiary, Glenmark Life Sciences (GLS). The firm will sell stake for Rs 5,651.5 crore, at a price of Rs 615 per share. Consequently, Glenmark Pharma will own 7.84% in GLS.
Vedanta: The company’s board has approved raising up to Rs 2,500 crore via non-convertible debentures (NCDs) in one or more tranches, on a private placement basis. It will issue up to 2.5 lakh NCDs with a face value of Rs 1 lakh each.
Economy News
According to data released by the Reserve Bank of India, net household savings fell to 5.1% of gross domestic product in FY23, from 7.2% of GDP recorded in FY22. Meanwhile, total financial liabilities as a share of GDP rose to 5.8% in the FY23, compared with 3.8% in FY22. Economists and analyst opine that higher debt and lower savings will have a direct impact on India’s consumption demand, which a key driver of the Indian economy.
Global Markets
Wall Street ended lower as investors were concerned over the Federal Reserve’s tighter monetary policy forecast and rising US Treasury yields. For the week, the Dow Jones fell 1.9%, the S&P 500 tanked 2.9%, and the Nasdaq tumbled 3.6%.
The Federal Reserve’s monetary policy committee kept the short-term lending benchmark rate unchanged at 5.25%-5.50%. Further, the US central bank hinted at one more hike before the end of the year and fewer rate cuts next year than previously expected. Meanwhile, the benchmark 10-year US Treasury yield hit a record high of 4.49%, while the 2-year Treasury yield rose 2 basis points to 5.142%, after the Fed announced its monetary policy decision.
Japan’s stock markets fell over the week, with the Nikkei 225 index tumbling 3.4% and the Topix falling 2.2%. The Bank of Japan (BoJ) kept the interest rates steady, in line with expectations. The Japanese yen weakened to about JPY 148.3 against the US dollar, from about JPY 147.8 the previous week. The BoJ kept its short-term interest rate at -0.1% and that of 10-year Japanese government bond (JGB) yields at around zero percent.
On the economic front, Japan’s core consumer price index (CPI) rose 3.1% in August from a year earlier, above the Bank of Japan’s 2% inflation target, due to higher food prices. The core-core CPI, which excludes volatile energy and fresh food prices, rose to 4.3%.
Chinese markets closed higher for the week as investors were more optimistic over the country’s economic growth outlook. The Shanghai Composite index gained 0.47%, the CSI 300 index added 0.81%, and the Hang Seng index declined 0.7%.