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Sensex, Nifty end near the day's low; IT shares decline
(15:39, 26 Jul 2022)

The domestic equity barometers ended near the day's low after a volatile session on Tuesday. The Nifty closed below the 16,500 level. Shares across sectors declined, with IT, FMCG and auto stocks declining the most.

As per provisional closing data, the barometer index, the S&P BSE Sensex, fell 497.73 points or 0.89% to 55,268.49. The Nifty 50 index lost 147.15 points or 0.88% to 16,483.85.

In the broader market, the S&P BSE Mid-Cap index fell 1.21% while the S&P BSE Small-Cap index declined 1.20%.

The market breadth was weak. On the BSE, 1,157 shares rose and 2,168 shares fell. A total of 142 shares were unchanged.

Buzzing Index:

The Nifty IT index declined 2.83% to 27,418.85. The index had advanced 0.17% to end at 28,216 yesterday.

Mphasis (down 6.32%), L&T Technology Services (down 5.39%), Mindtree (down 4.6%), Larsen & Toubro Infotech (down 4.17%) and Infosys (down 3.43%) were the top losers.

Among the other losers were Coforge (down 2.44%), Wipro (down 2.3%), HCL Technologies (down 1.91%) and Tata Consultancy Services (down 1.53%).

Stocks in Spotlight:

Asian Paints rose 0.07%. On consolidated basis, the paint major's net profit climbed 78.88% to Rs 1,016.93 crore on 54.1% surge in revenue from operations to Rs 8,606.94 crore in Q1 FY23 over Q1 FY22.

Amit Syngle, managing director & CEO of Asian Paints, said: “The domestic decorative business experienced good consumer demand and recorded stellar revenue growth for the quarter. The volume growth registered in the quarter is one of the highest in the last six quarters.

The Auto OE and the General Industrial Coatings business delivered a sturdy growth trajectory. We continued to make further inroads in our Home Décor business, proliferating its product & service offerings. The International business also delivered a good double digit revenue growth for the quarter despite multiple headwinds across key geographies.”

Bajaj Auto fell 2.13%. The company's consolidated net profit declined marginally to Rs 1,163.33 crore in Q1 FY23 from Rs 1,170.17 crore posted in Q1 FY22. Revenue from operations rose 8.37% year on year to Rs 8,004.90 crore in the quarter ended 30 June 2022. The company's total auto sales fell 7% to 9,33,646 units in Q1 FY23 over Q1 FY22. During the said period, domestic sales declined 1% and exports 10%.

Tata Steel slipped 1.37%. The company's consolidated net profit dropped 21% to Rs 7,714 crore in Q1 FY23 as against Rs 9,768.34 crore recorded in Q1 FY22. The company's turnover surged 18.64% YoY to Rs 63,430 crore in the quarter ended 30 June 2022.Tata Steel's production fell 1.78% to 7.74 million tonnes and YoY deliveries declined 6.89% to 6.62 million tonnes in Q1 FY23. The steel maker's net debt stood at Rs 54,504 crore in Q1 FY23.

Axis Bank lost 2.93%. The private lender's net profit surged 91% to Rs 4,125.26 crore on 12.2% increase in total income to Rs 21,727.61 crore in Q1 FY23 over Q1 FY22. Net interest margin (NIM) for Q1 FY23 stood at 3.60%, up 14 basis points YoY and 11 basis points QoQ.

Tech Mahindra fell 1.50%. On a consolidated basis, the IT major's net profit fell 24.8% to Rs 1,131.60 crore on 4.9% increase in revenue from operations to Rs 12,707.90 crore in Q1 FY23 over Q4 FY22. EBITDA margin decreased to 14.8% in Q1 FY23 from 17.2% in Q4 FY22 and 18.4% in Q1 FY23.

Bajaj Finserv surged 5.47%. The company said its board will consider a stock split and/or bonus issue of equity shares on 28 July 2022. On the same day, the board will also consider the unaudited financial results for the quarter ended 30 June 2022.

Chennai Petroleum Corporation (CPCL) rose 2.97%. The company's standalone net profit surged to Rs 2,358.79 crore in Q1 FY23 as against Rs 53.73 core in Q1 FY22. Net sales surged to 183.6% YoY to Rs 23,162.55 crore for the quarter ended 30 June 2022. Average gross refining margin (GRM) for Q1 FY23 stood at $25.04 per bbl as against $5.68 per barrel in the corresponding period last year, up 340.85% on a YoY basis.

GlaxoSmithKline Pharmaceuticals fell 1.86%. The pharmaceutical firm's consolidated net profit slipped 1.5% to Rs 119.28 crore on 3.7% increase in net sales to Rs 745.10 crore in Q1 FY23 over Q1 FY22.

Lupin shed 0.80%. The drug major has received approval from the United States Food and Drug Administration (US FDA) for its abbreviated new drug application (ANDA) Azilsartan Medoxomil tablets. The product is a generic equivalent of Edarbi tablets of Azurity Pharmaceuticals, Inc. The drug is primarily used to reduce high blood pressure. Azilsartan Medoxomil tablets had estimated annual sales of $101 million in the U.S. (IQVIA MAT March 2022).

Sun Pharmaceutical Industries declined 0.36%. The company and Cassiopea today announced the signing of addendums to the license and supply agreements for WINLEVI (clascoterone) cream 1% expanding the territory to include Japan, Australia, New Zealand, Brazil, Mexico and Russia.

Global Markets:

The Dow Jones futures were down 130 points, indicating a negative opening in the US stock market today.

Most European shares declined while most Asian stocks ended mostly higher on Tuesday.

South Korea's economy grew 0.7% in the second quarter compared with the first quarter of 2022, according to estimates released by the Bank of Korea. The country's GDP grew 0.6% in the January to March quarter.

The Bank of Japan released the minutes for it June meeting on Tuesday, after keeping its interest rates at ultra-low levels last week. Members of the BOJ policy board said the economy was on its way to recovery from the effects of Covid, but still needs strong support on the financial side due to pressure from the rise in commodity prices.

They also agreed that it was necessary to pay due attention to developments in financial and foreign exchange markets and their impact on Japan's economic activity and prices, the minutes said.

Wall Street stock markets delivered a mixed performance on Monday as cautious investors looked ahead to a week of Big Tech earnings and a crucial interest rate decision from the US Federal Reserve.

At the end of its two-day monetary policy meeting on Wednesday, the Fed is widely expected to raise its main interest rate by 0.75 percentage points.

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