Post-market views - July 28, 2023 - Reliance Securities

Mr. Vikas Jain, Senior Research Analyst at Reliance Securities.

Indian equities ended lower following weak global cues. Nifty was down 0.1% while Nifty Mid Cap and Nifty Small Cap ended 0.6% and 0.2% higher respectively. Majority of the Sectoral indices ended in green. Nifty Reality (+1.8%), Nifty Media (+1.4%) and Nifty Metal (+0.9%) were the major gainers. Nifty IT (-0.9%) and Nifty Bank (-0.5%) were the primary laggards.

U.S. stocks ended lower on Thursday after news that the Bank of Japan will allow long-term interest rates to rise sent U.S. yields higher, snapping the longest winning streak for the Dow since 1987. The S&P 500 lost 0.63%, while the Nasdaq Composite lost 0.54%.

The Dow Jones Industrial Average fell 0.66%. Higher rates in Japan pushed the U.S. 10-year yield over 4%. Traders now only see a 20% chance that the Fed could surprise with a quarter-point increase in September. Moreover, Commerce Department report showed the economy grew at 2.4%, more than expectations of 1.8% in the latest quarter.

The earnings season will pick up pace in the coming days. While companies in the IT sector reported decent order wins, revenue has remained under pressure due to cuts in spends by the clients.

Consumption expenditure remains muted due to elevated price levels. Globally, the U.S economy seems to be resilient but the FED rose interest rates by another 25bps rate hike as expected. Investors will follow the management commentary and keep an eye on macroeconomic data for further cues.