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Sensex, Nifty settle with modest gains

·8-min read

Trading for the week began on positive note as the key indices logged modest gains on Monday. Intraday volatility was high. The Nifty managed to close above 10,800 mark after falling below that level in intraday trade. Gains were led by index pivotals Reliance Industries, Infosys and Hindustan Unilever.

The barometer S&P BSE Sensex rose 99.36 points or 0.27% at 36,693.69. The Nifty 50 index added 47.15 points or 0.44% at 10,815.20.

In the broader market, the S&P BSE Mid-Cap index gained 0.05% while the S&P BSE Small-Cap index lost 0.15%.

The market breadth was weak. On the BSE, 1119 shares rose and 1579 shares fell. A total of 178 shares were unchanged. In the Nifty 50 index the breadth was positive with 33 stocks advancing and while 17 stocks declining. 1 stock remain unchanged.

Among the sectoral indices on the BSE, the S&P BSE Energy index (up 2.47%), the S&P BSE Telecom index (up 1.93%) and the S&P BSE Teck index (up 1.61%) outperformed the S&P BSE Sensex. Meanwhile, the S&P BSE Realty index (down 1.52%), the S&P BSE Finance index (down 1.49%) and the S&P BSE Bankex (down 1.39%) underperformed the S&P BSE Sensex.

Stocks in Spotlight:

Reliance Industries (RIL) gained 2.97%. The scrip surged 3.64% to hit an all time high of Rs 1,947 in intraday trade today. RIL and Jio Platforms announced that Qualcomm Ventures, the investment arm of Qualcomm Incorporated, an industry leader in wireless technologies, has committed to invest upto Rs 730 crore in Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore. Qualcomm Ventures' investment will translate into 0.15% equity stake in Jio Platforms on a fully diluted basis. The investment will deepen the ties between Qualcomm and Jio Platforms, to support Jio Platforms on its journey to rollout advanced 5G infrastructure and services for Indian customers.

Separately, Reliance Industries' subsidiary Jio Platforms received subscription amounts from Interstellar Platform Holdings Pte (Rs 1,894.50 crore for 0.39% stake), The Public Investment Fund (Rs 11,367 crore for 2.32% stake), SLP Redwood Holdings and SLP Redwood Co-Invest (DE), L.P. (Silver Lake) (Rs 10,202.55 crore for 2.08% stake) and General Atlantic Singapore JP Pte (Rs 6,598.38 crore for 1.34% stake).

Infosys rose 1.91%. Infosys and Old National Bancorp, the largest financial services bank holding company headquartered in Indiana, announced a strategic partnership that will enable faster adoption of digital solutions, modernize ONB's existing technology infrastructure, and enhance both the client and employee experience.

Hindustan Unilever gained 1.84%. A meeting of the board of directors of the company will be held on July 21, 2020, through Audio-Visual means to consider the proposal for payment of interim (special) dividend, if any, for the financial year ending March 31, 2021.

Avenue Supermarts fell 3.86% after the company's consolidated net profit slumped 85.22% to Rs 49.56 crore on 32.94% fall in total income to Rs 3,884.57 crore in Q1 June 2020 over Q1 June 2019.

HDFC Bank fell 2.26% to Rs 1080.40. Media reports suggested that the private lender is probing into the allegations of improper lending practices in its vehicle finance business. While the nature of these allegations could not be ascertained, the bank is reportedly looking into them with regards to its vehicle finance vertical, the reports added.

Biocon rose 0.07%. The company said that it has received the Drugs Controller General of India's (DCGI) approval to market Itolizumab injection for emergency use in India for the treatment of cytokine release syndrome (CRS) in moderate to severe ARDS (acute respiratory distress syndrome) patients due to COVID-19.

Clariant Chemicals (India) was locked in an upper circuit of 20% at Rs 583.55 after the company declared a special interim dividend of Rs 140 per equity share for the financial year FY 2020-21. The company has fixed 18 July 2020 as the record date for the purpose of payment of special interim dividend.

BASF India jumped 11.18%. The company's board approved the acquisition of 100% stake in BASF Performance Polyamides from BASF Nederland B.V. and BASF SE, for a consideration of an amount not exceeding Rs. 305 crore. This acquisition would strengthen the Company's position as a solution provider for key industries & would enhance market access to key growth markets. It would help the Company in expanding its existing 'Materials' segment and extend value chain through backward integration into key raw materials.

Steel Authority of India (Sail) lost 3.25%. The company's consolidated net profit surged 382.9% to Rs 2,647.52 crore on 12.5% decline in net sales to Rs 16,171.83 crore in Q4 March 2020 over Q4 March 2019. In FY20, Sail made a turnover of Rs 61,024.88 crore. EBITDA per tonne of saleable steel improved to Rs 7,869 from Rs 7,284 in FY19. The company's EBITDA/turnover figure stood at 18.35% compared to 15.52%. Sail also achieved its best ever 14.23 million tonnes (MT) annual sales during FY20.

Gujarat Narmada Valley Fertilisers & Chemicals (GNFC) lost 1.27%. The company said it reported 152.11% surge in consolidated net profit to Rs 240.01 crore on 6.2% decline in net sales to Rs 1,342.47 crore in Q4 March 2020 over Q4 March 2019. The board has recommended a dividend of Rs 5 per equity share for the year ended 31 March 2020.

Galaxy Surfactants gained 1.72% after the company restarted operations at its units in Tarapur location in a phased manner after receiving necessary permissions from the statutory authorities. In mid-April, there had been a small intermediate feed tank blast at the company's Tarapur plant. The firm on April 15 had announced the closure of the plant and had said that the operations at the same would be resumed post obtaining necessary permissions from the statutory authorities.

COVID-19 Update:

India reported 3,01,609 active cases of COVID-19 infection and 23,174 deaths while 5,53,470 patients have been cured, according to the data from the Ministry of Health and Family Welfare, Government of India. Total coronavirus cases worldwide stood at 12,910,357 with 569,128 deaths so far, according to data from Johns Hopkins University.

Economic data:

The retail inflation data for the month of June 2020 will be released later today. Investors await the release of June inflation data as it could open the possibility of further interest rate cuts by the RBI to help the economy amid surging coronavirus surging cases and regional lockdowns.

The Ministry of Statistics And Programme Implementation on Friday released quick estimates of the Index of Industrial Production (IIP) which showed the index value at 88.4 in May against 53.6 in April, indicating a graded pickup in industrial activity. The index stood at 135.4 in May 2019. IIP for May 2020 declined by 34.7% but at a slower pace compared to April 2020, where the index had contracted by 57.6%.

Numbers to Track:

The yield on 10-year benchmark federal paper rose to 5.787% as compared with 5.760% at close in the previous trading session.

In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 75.19, compared with its close of 75.2050 during the previous trading session.

In the commodities market, Brent crude for September 2020 settlement fell 56 cents at $42.68 a barrel. The contract rose 89 cents, or 2.10% to settle at $43.24 a barrel in the previous trading session.

MCX Gold futures for 5 August 2020 settlement rose 0.54% to Rs 49,140.

Global Markets:

Shares in Europe and Asia advanced across the board on Monday buoyed by hopes of a coronavirus vaccine, though a spike in infections around the world capped gains.

The Dow Jones Futures were trading 205 points higher, indicating a strong start in US markets today.

Investors remained watchful of the corporate earnings as that would reveal how companies fared during the second quarter of the fiscal year 2020-21, the period during which when nationwide lockdowns were imposed in most of the countries around the globe.

The US stock market settled session higher after recouping early losses on Friday, 10 July 2020, as a positive update from Gilead's antiviral drug to treat COVID-19 brushed off worries about a fresh wave of coronavirus infections and its impact on the economic recovery.

Gilead Sciences said on Friday that an analysis of clinical-trial data for its remdesivir drug found a 62% reduction in mortality risk among severely ill COVID-19 patients compared with standard care.