Sensex, Nifty Snap Two-Day Losing Streak Led By Bajaj Twins

India stocks advanced as overseas investment into local shares picked up pace amid a steady decline in new coronavirus cases.

The S&P BSE Sensex rose 0.7% to 52,300.47, while the NSE Nifty 50 Index climbed 0.6% to 15,737.75. The Bajaj twins -- Bajaj Finance Ltd. and Bajaj Finserv -- were the best performers on both indices. Of the 30 shares in the Sensex, 23 gained and 7 fell.

The broader market outperformed their larger peers. The S&P BSE MidCap gained 1.26% and S&P BSE SmallCap advanced 1.73%. Eighteen of the 19 sector sub-indices compiled by BSE Ltd. increased, led by a gauge of real estate companies. The S&P BSE Auto Index was the lone drag, falling 0.1%.

The market breadth was firmly skewed in favour of the bulls. About 2,454 stocks gained, 729 declined and 150 remained unchanged, according to the BSE data.

Global investors have bought shares worth $1.1 billion this month through Tuesday, compared with nearly $749 million for all of last month, data compiled by Bloomberg show. Equities have received inflows of over $7.7 billion this year.

Indiabulls Housing Finance Ltd. rose 11%. Trading in the company's call options was quadruple the average. Trading volume was quadruple the average for this time of day.

• The stock was the best performer among its peers.
• Trading volume was 83.4 million shares, quadruple the 20-day average of 23.4 million shares for this time of day.
• Trading in the company's call options totalled 52,220 contracts, compared with the average of 13,833 over the past 20 days. Trading in the company's put options totalled 13,508 contracts, compared with the average of 3,981 over the same period.
• The relative strength index on the stock was above 70, indicating it may be overbought.
• Analysts have two buy, no hold, and one sell recommendations on the stock.
• The price target of Rs 185 represents a 36% decrease from the last price

A gauge of media companies climbed as much as 5.3%, the most since August 2020.

• Network 18 contributed the most to the index gain and had the largest move, increasing 20%.
• The index is up 15.6% year to date compared to a 12.5% rise in the Nifty 50.

Century Ply reported net income for the fourth quarter that beat the average analyst estimate.

• Net income Rs 83.23 crore vs. Rs 38.79 crore YoY, estimate Rs 77.40 crore
• Revenue Rs 739 crore, +41% YoY, estimate Rs 693 crore
• Total costs Rs 631 Rs, +32% YoY

Bajaj Finance Ltd. rose 7.2%. Trading in the company's call options was triple the average. Trading volume was double the average for this time of day.

• The stock was the best performer among its peers.
• Trading volume was 3.66 million shares, double the 20-day average of 1.63 million shares for this time of day.
• Trading in the company's call options totalled 147,990 contracts, compared with the average of 50,580 over the past 20 days. Trading in the company's put options totalled 57,382 contracts, compared with the average of 23,481 over the same period.
• Analysts have 16 buy, six hold, and seven sell recommendations on the stock.

• The price target of Rs 5,361.04 represents a 12% decrease from the last price

A rally in the stocks of companies controlled by Indian billionaire Gautam Adani has added almost $43 billion to his wealth this year, catapulting him to the spot of the second-richest person in Asia. Some analysts say the gains are fraught with risk.

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• Hindustan Unilever options volume 3.7x the 20-day average, with 51,826 calls changing hands vs 10,657 puts
  • Stock up 1.7%, volume 1.1x the 20-day average for this time of day
• Divi's Labs options volume 3x the average, with 24,621 calls vs 7,637 puts
  • Stock up 2.7%, volume 1.7x the average
• Tech Mahindra options volume 1.7x the average, with 17,761 calls vs 4,008 puts
  • Stock up 1.7%, volume 1.1x the average
• Power Grid options volume 1.7x the average, with 14,443 calls vs 3,093 puts
  • Stock was little changed, volume 1x the average
• Tata Consumer options volume 1.5x the average, with 10,550 calls vs 2,224 puts
  • Stock up 0.8%, volume 0.7x the average

Indian equity benchmarks maintained their steady gain after opening today's trading higher.

The S&P BSE Sensex is trading 0.41% up at 52,155.25, while NSE Nifty 50 Index is also slightly up at 15,703.35.

The broader market outperformed their larger peers. The S&P BSE MidCap gained 0.78% and S&P BSE SmallCap advanced 1.5%. Only two of the 19 sector sub-indices compiled by BSE Ltd. declined, led by auto stocks. The S&P BSE Healthcare was the best performer, up 2.91%.

The market breadth was heavily skewed in favour of the bulls. About 2,337 stocks gained, 729 declined and 143 remained unchanged.

Shares of sugar mills in India continued to rally, driven by an outlook for higher exports as well as the government’s move to advance a deadline on blending ethanol with gasoline.

• Indian companies’ exports for the current sugar season that ends in Sept. will likely cross the target of 6m tons as lower contribution from Brazil and Thailand has resulted in a global supply deficit, Crisil wrote in a note dated June 9
• Sugar companies’ operating profitability will improve 75-100 bps to 13%-14% this fiscal year, helped by higher sugar exports, the note said
• Additionally, the stock of sweetener in the country is expected to decline to the lowest level in the past four sugar seasons, to 9m-9.5m tons this season, resulting in lower working capital borrowings

To read analysts’ view on the sector, click here

Bata India Ltd. rallies most in 14 months after the footwear maker reported quarterly profit that was ahead of analysts’ expectations, mainly driven by a sharp decline in raw material cost.

• On June 9, the footwear maker reported its earnings three months ended March after trading hours in Mumbai; its net income of Rs 29.44 crore beat the consensus view of Rs 26.8 crore, while revenue met estimates
• Q4 raw material costs plunged 85% YoY to Rs 14.39 crore
• Company also said it has adequate cash reserves and is curbing discretionary expenses to eliminate redundancies
• Bata’s sales performance seen slowing in coming quarters due to nationwide lockdowns and anticipated further delays in the opening of malls, Sachin Bobade, an analyst at Dolat Capital Market, said in a note
• The company’s focus on store additions, new promotional activities and procuring institutional contracts will help it recover from a lull in sales growth
• Cuts FY22 EPS target by 16% to Rs 19.3
• Retains accumulate with a price target of Rs 1,697

India’s total vehicle retail sales for May were 535,855 units, compared with 1.19 million vehicles sold in April, according to data released by the Federation of Automobile Dealers Associations.

• May two-wheeler retail sales fell by 52.5% over April to 410,757 units, passenger vehicles sales fell by 59% m/m to 85,733 units; May tractor sales fell by 57% and CV sales fell by 66% from a month earlier
• The first nine days of June saw a better start than expected due to pent up demand: statement
  • June may result in almost equivalent sales when compared to June 2020
• Overall demand recovery to be slow as rural markets continue to struggle with post-Covid effects; FADA continues to “remain guarded in its optimism on overall industry recovery” for FY21-22: statement

JSW Steel reported crude steel production for May of 1.37 million tonnes vs. 1.25 million YoY.

• Flat-rolled products output rises 10% YoY to 999,000 tonnes
• Long rolled products output rises 55% YoY to 309,000 tonnes
• Capacity Utilisation at 91% in May
• Co. supplied 30,000 tonnes of liquid oxygen for medical purposes in May vs 20,000 tonnes in April

Indian equity benchmarks were off to a steady start, in line with their Asian peers, led by metal and utilities companies.

The S&P BSE Sensex gained 0.4% to 52,146, while the NSE Nifty 50 Index rose 0.4% as well to 15,696. Reliance Industries Ltd. contributed the most to the index gain, increasing 0.5%. JSW Steel Ltd. had the largest increase, rising 1.8%.

The broader market outperformed their larger peers. The S&P BSE MidCap gained 0.85% and S&P BSE SmallCap climbed 1.3%. All the 19 sector indices compiled by BSE Ltd. advanced, led by gauges of metal and utilities companies.

Global investors have bought shares worth $1.1 billion this month through Tuesday, compared with nearly $749 million for all of last month, data compiled by Bloomberg show. Equities have received inflows of over $7.7 billion this year.

Indian sovereign bond traders are awaiting details of the papers the central bank will buy next week. Lower crude prices and U.S. yields may help a positive opening for bonds.

• The RBI will buy Rs 30,000 crore ($4.1b) of sovereign bonds and Rs 10,000 crore of state debt at its June 17 government securities acquisition program auction
• 10-year yields were little changed at 6.02% on Wednesday
• USD/INR rose 0.1% to 72.9750

Asian stocks rose Thursday after Treasuries rallied ahead of a U.S. inflation report that may provide clues on the monetary policy outlook.

Japanese, Australian and Hong Kong shares advanced along with U.S. equity contracts. The S&P 500 again flirted with a record before slipping, continuing a pattern of range-bound trading also evident at a global level.

India's SGX Nifty 50 Index futures for June delivery rose 0.2% to 15,708.50, while MSCI Asia Pacific Index gained 0.5%. The NSE Nifty 50 Index fell 0.7% Wednesday to 15,635.35.

The offshore yuan climbed after the Chinese and U.S. commerce ministers agreed to push forward trade and investment links in their first call since the start of President Joe Biden’s administration.

The rally in commodities, one of the leading reflation plays, continued to stall. Oil slipped amid an increase in U.S. fuel stockpiles. Bitcoin held an advance.

Traders are awaiting the European Central Bank policy decision and a Group of Seven summit, which is set to vow delivery of at least 1 billion extra vaccine doses over the next year to help cover 80% of the world’s adult population.

Back home, Bata India may react as the company reported quarterly results after the market closed Wednesday. SAIL, Century Plyboards are among the companies scheduled to report earnings Thursday. TCS holding its annual shareholders’ meeting. Foreign investors bought net Rs 3,840 crore of stocks on Tuesday, according to the NSDL website.