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Indian equity markets staged a dramatic final hour recovery to end higher for the 10th straight day, led single handedly by financial stocks.
The S&P BSE Sensex ended 0.4% higher at 40,794, recovering over 500 points from the day's low of 40,279. The NSE Nifty 50 index also recovered 140 points from the day's low of 11,822 to end 0.3% higher at 11,971.
The 10-day winning streak for the Nifty was last seen in January 2015. The last time the Sensex gained for 10 straight sessions, was way back in 2007!
As mentioned earlier, it was the Nifty Bank that led the recovery in the final hour. The Index recovered over 700 points from the day's low of 23,149 to end 1.6% higher at 23,874. 10 out of the 12 index constituents, which were declining at mid-day trading, ended with gains.
Top six gainers on the Nifty 50 index were BFSI stocks - Bajaj Finserv, SBI Life, Bajaj Finance, IndusInd Bank, ICICI Bank and Axis Bank.
The PSU Bank index also contributed to the recovery, ending with gains of 1%.
Among the laggards today were I.T. and Pharma stocks. The Nifty I.T.'s longest winning streak in 22 years came to an end today, with the index ending 1.3% lower. The Nifty Pharma index ended lower for the third straight day, declining 0.7%.
Broader markets remained subdued in today's session. The midcap index ended 0.2% lower while the smallcap index gained 0.3%.
India Volatility Index ended 2.4% lower at 20.21.
Market breadth remained in favour of the laggards, despite the late recovery. 1,006 stocks on the NSE ended with losses while 832 stocks posted gains.
Factors At Play For Infosys:
Shares fell as much as 1.8% to Rs 436 and have declined in three out of the last four trading sessions.
In its most recent note, Morgan Stanley says that their portfolio tweaks are based on rising momentum and broadening of the economic recovery.
The note has advised narrowing sector positions with focus on stock picking as return co-relation across stocks have risen to levels from where they tend to mean revert.
"This means we have exited a macro market and entered a stock pickers' market," the note said.
With economic recovery being stronger than consensus expectations, Morgan Stanley prefers domestic cyclicals over defensives.
It is also shifting focus to small and midcap stocks as valuations are currently looking attractive versus history and that share of the market in both market cap and profits is at an all-time high, and awaiting mean reversion.
In terms of sectors - Morgan Stanley has turned underweight on energy (from +300 basis points to -100 basis points), overweight on financials (from 0 to 100 basis points) and on utilities (from 0 to 100 basis points).
Jockey's Indian partner Page Industries is under investigation from a top apparel industry watchdog, Reuters reports.
The investigation comes after the stock was dropped by Norway's Sovereign Wealth Fund from its investment portfolio due to concerns of human rights violations at its Bengaluru manufacturing site.
Shares are off the day's low after declining as much as 3.2% to Rs 20,036. The stock is down for the third straight day.
BloombergQuint has written to the apparel watchdog, seeking a comment on the same. It is awaiting a response.
Let's take a look at how European markets are trading:
India's diamond exports are set to fall by as much as a quarter this year as Covid-19 impacts demand and supply chains, Bloomberg News reports.
Overseas sales of cut and polished diamonds may slump 20-25% in the year ending March 2021, according to Colin Shah, chairman of the Gem & Jewellery Export Promotion Council.
This will push exports to the lowest in data going back to 2009. "While festivals such as Diwali, Christmas, Valentine's Day and Lunar New Year will prop-up demand in the next six months, it will not be enough to lift full-year exports," Shah said in an interview.
India's diamond exports fell 37% to $5.5 billion in the six months through September as compared to the previous year.
"Still, it’s difficult to predict global supply chains as rules to control the virus change frequently," Shah said.
India's wholesale prices for the month of September rose 1.32% as compared to the previous year in September, as per the Press Information Bureau.
The figure is higher than the 0.91% estimated by economists in a Bloomberg survey. The survey of 16 economists had pegged the range between 0.33% - 1.6%.
Primary article prices rose 5.1% as compared to the previous year while fuel, power and lighting prices fell 9.54%.
Wholesale food prices rose 6.92% year-on-year while manufactured product prices rose 1.6% compared to last year.
The company has decided to raise Rs 4,000 crore on October 15, through private placement of unsecured, non-convertible bonds in the form of debentures.
The debentures will be raised at a coupon of 5.45% per annum with a door-to-door maturity of five years.
The proceeds will be used for funding the company's capex, refinancing existing loans and other general corporate purposes, the company said in an exchange filing.
The bonds are proposed to be listed on the Bombay Stock Exchange, as well as the National Stock Exchange.
10 lakh shares of the company exchanged hands in a single large trade, as per data from Bloomberg. Buyers and sellers of the trade remain unknown.
Shares fell as much as 4.8% to Rs 78.7 and are down for the third straight day. The stock is trading at the lowest level in nearly seven months.
Rakesh Jhunjhunwala Says India At The Cusp Of A Bull Market
Shares are locked in an upper circuit of 20% at Rs 403.2, post the announcement.
The company has informed the exchanges that it has received the Letter of Award (LoA) from the Gujarat Urja Vikas Nigam to develop a 100 MW Solar project in Dholera Solar Park.
The energy will be supplied to GUVNL under a Power Purchase Agreement, valid for a period of 25 years from the scheduled commercial operation date, the company said in an exchange filing.
The project has to be commissioned within 15 months from the date of execution.
The cumulative capacity under development in Gujarat for the company will now be 620 MW, post this order win.
The plant is expected to generate about 246 Million Units of energy per year.
Shares fell as much as 2.6% to Rs 52.65 and have declined in four out of the last five trading sessions.
Covid-19 Remains Top Risk For Fund Managers, Says BofA Survey
The currency has opened flat in today’s session after ending lower for the second straight day on Tuesday.
The rupee opened at 73.37 against the U.S. Dollar as compared to Tuesday's close of 73.36.
The IMF further cut India's economic growth forecast on Tuesday, which may impact sentiment in the currency and bond markets.
Yield on the 10-year government bond opened at 5.896% as compared to Tuesday's close of 5.898%.
Acuite Ratings and Research said that management of bond yields may prove to be 'seriously challenging' in such an inflationary and fiscal environment.
The private lender reported double-digit growth in its Net Interest Income as well as net profit for the second quarter of FY21.
Net Interest Income rose 15.3% year-on-year to Rs 574.9 crore while net profit was up 12.7% to Rs 119.4 crore.
Asset quality saw an improvement on a sequential basis. Gross NPA stood at 3.97% from 4.64% in the previous quarter while Net NPA stood at 2.21% from 3.01% in the first quarter.
The growth in advances and deposits however remained muted. Deposits were up 4% to Rs 72,922.6 crore while advances grew 1.2% year-on-year to Rs 54,098.9 crore.
Capital Adequacy Ratio of the bank was 13.08% from 12.64% last year while Provision Coverage Ratio was at an all-time high of 75.44%.
Shares rose as much as 6% to Rs 44.55 post the announcement. The stock is up for the fifth straight day.
The company announced positive top-line results from the Phase 3 clinical trial of SDN-037, which is used for treatment of inflammation and pain related to Ocular surgery.
The trial met its pre-specified primary and secondary objectives, demonstrating that SDN-037 is superior to its vehicle, the company said in its exchange filing.
A statistically significant proportion of patients treated with SDN-037 achieved an Anterior Chamber Cell (ACC) grade of 0 in the intent-to-treat population.
Shares rose as much as 2.6% to Rs 173.5, post the announcement. The stock had a three-day losing streak until today.
Shares fell as much as 6% to Rs 353.6, down for the second straight day.
Indian equity markets have begun mid-week trade on a sombre note, owing to lack of directional cues and signs of exhaustion at higher levels.
The S&P BSE Sensex has opened unchanged at 40,623 while the NSE Nifty 50 index has opened 0.2% lower at 11,917. Both Sensex and Nifty managed to eke out gains in the final minutes of trade on Tuesday, to end higher for the ninth day in a row.
Sectoral indices too have opened flat but with a negative bias. The Nifty Bank index has opened 0.6% lower ahead of the loan moratorium case hearing in the Supreme Court. Most of the other indices have opened with little or no movement.
Broader markets too have opened flat at the start of trade. The midcap index is trading 0.1% lower while the Smallcap index is unchanged.
713 stocks on the NSE have opened with gains while 710 stocks are declining.
Source: ICICI Direct
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