Daily Market Commentary - Sep 30, 2022 - Bonanza Portfolio

Mr. Vishal Wagh, Research Head, BONANZA PORTFOLIO LTD

Indian indices opened on a negative note amid weak global cues and ahead of RBI policy. At the time of closing, Sensex was up by 1,016.96 points or 1.80% to close at 57,426.92 and Nifty was up by 276.25 points or 1.64% to close at 17,094.35.

During the day, Indian benchmark indices ended sharply higher. The Reserve Bank of India (RBI) raises the repo rate by 50 bps to 5.9%. RBI MPC maintains a policy stance on the withdrawal of Accommodation. SDF stands adjusted to 5.65 % & MSF to 6.15%. RBI slashes India's real GDP growth rate from 7.2% to 7% for FY23. The inflation projection remained at 6.7% for FY23. India has received responses from 4-5 countries for its mechanism for international trade settlement in rupees. The central government has marginally lowered its market borrowing target for FY23 amid robust tax revenues. The full-year borrowing target has been cut to Rs. 14.21 lakh cr. from Rs. 14.31 lakh cr. as spelt out by the Budget for FY23. Despite the cut, the borrowing will be the highest ever. The central government is likely to revise the windfall gain tax on domestic oil refiners soon. The development comes days after the government reduced the windfall tax on locally produced crude oil to Rs. 10,500 from Rs. 13,000/tonne after its 5th fortnightly review.

China's factory activity unexpectedly expanded in September, helped by a series of recent easing measures, but gains were marginal as the economy continued to grapple with strict COVID curbs, a deepening property crisis, and softening export growth. Meanwhile, a sharp slowdown in services sector growth and a downbeat private manufacturing survey suggested the economy was struggling to regain traction after narrowly avoiding contraction in the second quarter. Sterling rose to a fresh 1-week high, helping to push the U.S. dollar index to a 1 week low, as British policymakers moved to undo some of the damage caused by last week's tax-slashing, debt-swelling fiscal plan. That puts the UK currency on course for its best week in 2.5 years. Eurozone September CPI inflation at 10% YoY and Preliminary September Core CPI at 4.8%. Asian shares were headed for the worst month since the onset of the COVID-19 pandemic. On the sectoral front, all the indices end in red with Auto, Power, Capital Goods, Banks, and Metals up by 1-2%.

Nifty 50 top gainers are Hindalco, Bharti Airtel, Indusind Bank, Baja Finance & Bajaj Financial Services while Adanient, Dr. Reddy, Cipla, Coal India & Apollo Hospital were among the top loser.

Source : Equity Bulls

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