Nifty50: 16,216 ▼ 4 (-0.03%)
Sensex: 54,395 ▼ 86 (-0.1%)
Howdy, fam!
This World Population Day, let's celebrate our country's vibrant cultural mix and its sturdy auto rickshaws. In Uttar Pradesh, an auto rickshaw was stopped by the police for overcrowding. Guess how many people were crammed in it… 27! That’s enough people to fill a mini van!
- After a gap-down opening, markets made a recovery in the second half of the session to close nearly flat.
- In all, 28 of the Nifty50 stocks closed in the green.
- Investors await India’s June inflation data to be released on Tuesday, while the US inflation data is due on Wednesday.
Among the Nifty sectoral indices, Metal (+1.9%) and PSU Bank (+1.8%) saw gains, while IT (-3.0%) was the sole loser.
| Top gainers | Today's change |
| Eicher Motors | 3,049 ▲ 117 (+4.0%) |
| ONGC | 125 ▲ 3.9 (+3.2%) |
| TATA Steel | 912 ▲ 27 (+3.0%) |
| Top losers | Today's change |
| Bharti Airtel | 659 ▼ 35 (-5.1%) |
| TCS | 3,112 ▼ 153 (-4.7%) |
| HCL Tech | 941 ▼ 42 (-4.3%) |
What’s trending
⭐ Airtel falls after Adani enters 5G race 📱
BHARTIARTL (NSE): 659 ▼ 35 (-5.1%)
Shares of Bharti Airtel fell 5% intraday after Adani Group announced it will enter the race for 5G spectrum. However, Adani Group said it has no plans to enter into the consumer mobility sector. The company plans to use the 5G spectrum to provide a private network for its various businesses.
⭐ L&T bags big construction order 🚧
LT (NSE): 1,661 ▼ 26 (-1.5%)
The construction major has said that its buildings and factories segment has secured various contracts valued between ₹1000 crore-₹2500 crore. The orders include the construction of data centers with a total capacity of 10.8MW in Mumbai and Navi Mumbai. Other orders include the construction of commercial office space in Hyderabad and a 108-foot statue in Madhya Pradesh.
⭐ Steelmakers forge comeback 💪
TATASTEEL (NSE): 912 ▲ 27 (+3%), JINDALSTEL (NSE) 351 ▲ 8 (+2.3%)
Stocks of steelmakers gained on a report that the government was considering cutting or abolishing the export duty on key products. In May, the country had levied a 15% export duty on several finished steel products and pig iron to tackle inflation and increase output. This had led to a sharp fall in shares of steelmakers, which derive significant revenues from steel exports.
⭐ Paytm loan disbursals rise 💵
PAYTM (NSE): 710 ▲ 11 (+1.6%)
Paytm shares traded higher after it reported that its loan disbursements jumped nearly 9x year-on-year to ₹5,554 crore in Q1 of FY23. The company disbursed 84.8 lakh loans, up nearly 500% compared to last year. Its total merchant payment volume more than doubled to ₹2.96 lakh crore in the quarter, from ₹1.47 lakh crore in the same period a year ago.
⭐ Rupee plummets to new low 💰
The Indian rupee hit another fresh low against the US dollar on Monday. Investors continued to sell risky assets for the safer US dollar amid concerns about a global economic slowdown and weakness in the Indian stock market. On Monday, the rupee fell to 79.48 per dollar, as compared to the previous close of 79.26.
In Focus
Auto stocks zoom ahead
Auto stocks have been hitting the accelerator this year, and the Nifty Auto is trading around its all-time high. The index has risen over 10% year-to-date as compared to the 8% fall in the Nifty50. What's driving stocks higher? Let's take a long ride.
During the pandemic, a shortage of semiconductor chips and the significant rise in commodity prices had hit the brakes on auto sales. However, recent management commentary by auto companies has suggested that chip availability is improving. Also, the price of steel, a key raw material, has corrected from its peak after the government introduced a duty on steel exports.
Besides this, the forecast of a normal to good monsoon and the recent hike in minimum support prices (MSP) for kharif crops could result in higher cash flow for farmers. These factors are likely to boost the rural demand for tractors and two wheelers.
As per data released by the Federation of Automobile Dealers’ Associations (FADA), sales of commercial vehicles (CVs) were at 67,696, up over 89% year-on-year in June 2022. The post-pandemic pickup in economic and infrastructure activities has been a demand driver for the CV segment. Moreover, the reopening of schools and offices has given an additional boost to CV sales.
Going ahead, the rising demand for electric vehicles (EV) could be a key growth driver. In fact, Tata Motors and Mahindra & Mahindra believe that by FY27, 20% to 30% of their sales volumes will come from EVs.
In the near term, auto companies seem to be in top gear. However interest rate hikes and elevated commodity prices could act as speed breakers in the long term.
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