Indian share markets witnessed most of the selling pressure during closing hours today and ended lower.
The BSE Mid Cap index ended the day down by 0.7%, while the BSE Small Cap index ended down by 0.3%.
Sectoral indices ended on a mixed note with stocks in the power sector, metal sector and banking sector witnessing selling pressure, while energy stocks witnessed buying interest.
Asian stock markets ended on a mixed note as concerns around the ongoing coronavirus outbreak continued to weigh on investor sentiment.
As of the most recent closing prices, the Hang Seng was up 0.3% while the Nikkei was down 0.6%.
The rupee was trading at 71.38 against the US$.
Speaking of Indian share markets, we’ve been telling you about the rebound in smallcap stocks in 2020 for quite some time now.
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Have a look at the chart below:
Smallcaps Are Way Ahead of the Sensex in 2020
As you can see, since the start of 2020, smallcaps have beaten largecaps by a wide margin.
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We believe smallcaps have a long way to go.
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In news from the textiles sector, shares of Page Industries slipped 8% today after the company reported 14.6% fall in its net profit at Rs 870 million for the quarter ended December 31, mainly due to higher expenditure.
The company had reported a net profit of Rs 1,020 million in the corresponding quarter of previous fiscal.
Total expenditure of the company increased by 16.2% (year-on-year) YoY to Rs 6,803.8 million during the quarter under review.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) declined 16.5% YoY to Rs 1,353 million during the quarter, while margin slipped to 17% against 22% YoY.
Its revenue grew by 7.5% at Rs 7,938 million on a YoY basis.
The company said that a temporary dip in profit after tax was entirely due to enhanced investment in sales and marketing, people, and technology.
The company’s board also declared an interim dividend of Rs 58 per share.
Page Industries share price ended the day down by 4.8%.
Moving on to news from the macroeconomic space, data released by the commerce and industry ministry showed that India’s wholesale inflation accelerated to 3.1% in January driven up by fuel and power, and manufactured products.
Wholesale price inflation was 2.59% in December.
Inflation in fuel and power was 3.42% compared to a negative 1.46% in December 2019.
In manufactured products, which have a 64.23% weight in the index, the rate was 0.34% in January from a negative 0.25% in the trailing month.
The Ministry of Commerce said in a statement that the build-up inflation rate stood at 2.50% so far this financial year, as against 2.49% in the corresponding period a year ago.
Wholesale food inflation – or the rate of increase in wholesale food prices – softened to 10.12% last month compared with 11.05% in December.
In the food articles category, vegetable prices surged 52.7% mainly on account of 293% and 37.3% inflation in onions and potatoes, respectively.
The last time the wholesale inflation touched 3.1% was in April 2019. Before that, it touched 3.46% in December 2018. It had risen to 2.76% in January 2019.
The release of wholesale inflation data comes at a time when the economy is staring at the worst pace of annual expansion in more than 11 years, and the central bank has paused further monetary easing after reducing the key rates by 135 basis points (1.35 percentage point) last year.
In 2019, the RBI lowered the repo rate in five out of six bi-monthly policy reviews to aid growth.
What effect the inflation data has on economy in the coming days remains to be seen. We will keep you updated on all the developments from this space.
To know what’s moving the Indian stock markets today, check out the most recent share market updates here.
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