HDFC Bank drags Sensex 500 points lower, Nifty slips below 24,200

Indian equity indices traded in the red on Friday, dragged by index heavyweight HDFC Bank after the Street was disappointed by the lenders' weak Q1 update.

Sensex dropped over 500 points to 79,505, while the Nifty50 fell 183 points to slip below the 24,200 mark.

From the Sensex pack, Infosys, JSW Steel and ICICI Bank rose up to 0.5% while HDFC Bank, M&M and Tata Steel traded in the red.

Nifty Bank, Auto, Financial Services, Private Banks and Consumer Durables began the day in red with a loss of up to 0.85%.

Among individual stocks, HDFC Bank shares tumbled over 3% to Rs 1,665 after the company announced its Q1FY25 updates wherein a flat growth and a decline in the CASA were reported.

Kaya continued its upward streak on the second day following the update on the company's collaboration with Marico. The stock rose 10% in an early trading session.

Expert views
"In Thursday’s session, FIIs were net buyers at Rs. 2576 crores, while DIIs sold Rs. 2375 crores. Nifty is expected to trade between 23500-24500, with significant resistance at 24400 due to high Call open interest. The US Nonfarm Payrolls report, due at 6:00 PM IST, is anticipated to show 195k new jobs, a steady 4.0% unemployment rate, and slowing wage growth at 3.9% y/y, indicating a cooling labour market and potential for Fed rate cuts," said Prashanth Tapse, Senior VP (Research) at Mehta Equities.

"FIIs’ huge long position in the index derivatives and strong buying in the cash market can support the market in the near term. An important trigger may come from the US jobs data expected today. If the jobs data show a loosening labour market and a slowing economy, it can lead to rate cuts by the Fed in September. So, watch out for this data.

At 80000 Sensex there is no valuation comfort in the market. Investors should expect only moderate returns in the medium term at the present levels. Long-term prospects are certainly bright and, therefore, investors can continue with systematic investment. Asset allocation based on risk appetite should be the strategy at this juncture in the market," said V K Vijayakumar, Chief Investment Strategist, at Geojit Financial Services.

Global Markets
Asian share markets scaled new highs on Friday as investors sized up U.S. rate cuts for September and the mood was upbeat, while the euro hit a three-week peak ahead of French elections.

Japan's Nikkei and broader Topix both nudged up to record levels, as did Taiwan's benchmark.

US Markets remained closed on Thursday on account of Independence Day.

FII/DII Tracker
The Foreign institutional investors (FIIs) bought equities worth Rs 2,576 crore on July 4, while domestic institutional investors sold equities worth Rs 2,375 crore on the same day.

Crude Oil
Oil prices were little changed in Asian trade on Friday but were on track for a fourth straight week of gains and holding near their highest levels since late April on hopes of strong summer fuel demand and some supply concerns.

Brent crude futures, which have risen 7% over the last four weeks, slipped 2 cents to $87.41 a barrel by 0143 GMT.

Currency watch
The rupee rose 5 paise to 83.45 against US dollar in today's early trade.

The Indian rupee was expected to do well on Friday in the wake of the dollar's decline before a jobs report that is likely to hold cues on whether the Federal Reserve will cut interest rates later this year.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)