Sensex gains 447 pts, ends at 45,080 as RBI revises FY21 GDP growth outlook

All that happened in the markets today

The bulls continued to be in the driver's seat on Friday as the benchmark indices scaled fresh all-time highs after the Reserve Bank of India (RBI) revised upwards the economic growth projections for the fiscal year 2020-21 (FY21) and assured ample liquidity for the stressed sectors. 

The S&P BSE Sensex hit a new milestone today as the index breached the crucial 45,000 level for the first time ever to end at 45,080 levels, up 447 points, or 1 per cent. On similar lines, NSE's Nifty ended at 13,259, up 125 points, or 0.95 per cent. Volatility index, India VIX, dropped over 5 per cent to 18 levels. 

On a weekly basis, Nifty gained 2.2 per cent while Sensex added 2 per cent. 

In the broader market, the S&P BSE MidCap index ended 0.44 per cent higher at 17,389 levels while the S&P BSE SmallCap index settled at 17,317, up 72 points, or 0.42 per cent. 

On the NSE, all sectoral indices ended in the green with Nifty Bank surging the most - up 2 per cent or 604 points to 30,052 levels. 

Global markets

Asian shares scaled a record high on Friday on growing prospects of a large US economic stimulus package, while hopes that coronavirus vaccine rollouts will boost the global economy underpinned investor sentiment.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.78 per cent while Japan’s Nikkei dipped 0.22 per cent on profit-taking. 

In Europe, stocks were mixed. 

In commodities, oil prices jumped around 2 per cent on Friday, heading for a fifth week of gains, as major producers agreed on a compromise to continue some cuts to production to cope with coronavirus-hit demand even though these fell short of expectations.

(With inputs from Reuters)

4:18 PM

MARKET COMMENT :: Ajit Mishra, VP - Research, Religare Broking

Markets managed to post decent gains on Friday amid volatility. All eyes were on the RBI policy meeting outcome and the dovish commentary from the RBI and improved growth outlook lifted sentiments. Consequently, the Nifty index ended higher by 1 per cent at 13,259 levels. The broader markets, too, ended with healthy gains of 0.4 per cent and 0.5 per cent, respectively. Amongst the sectors, all the indices ended with gains wherein Banking, Telecom, and Consumer Durables were top performers.

 

With all the major events behind us, we feel global cues would dictate the market trend ahead. Besides, news related to Covid vaccines will also be in focus. Mostly rate-sensitive stocks ended on strong footing and we may see follow-up buying next week. Having said that, traders should not get carried away with the prevailing buoyancy and stick to quality names as we can’t ignore the possibility of an intermediate corrective phase.

3:43 PM

All sectoral indices on the NSE end in the green

3:42 PM

MARKET AT CLOSE | Gainers and losers on the S&P BSE Sensex

3:36 PM

CLOSING BELL

The S&P BSE Sensex gained 447 points, or 1 per cent to 45,080 levels while the NSE's Nifty ended at 13,259, up 125 points, or 0.95 per cent.

3:27 PM

MARKET CHECK

3:19 PM

BUZZING STOCK | Indostar Capital Finance jumps 18%

3:07 PM

Nifty Bank index surpasses 30,000-mark in intra-day trade

3:04 PM

IPO ALERT :: Burger King India IPO subscribed nearly 86x till 2:45 pm on Day 3

2:59 PM

MARKET COMMENT :: Anagha Deodhar – Economist, ICICI Securities on RBI Policy

Today’s monetary policy review was largely a non-event. In line with our expectation, the MPC kept rates unchanged and vowed to keep the stance accommodative at least during the current financial year and into the next financial year. It noted that inflation is likely to remain elevated despite some possible softening during winter months. Accordingly, it upped its inflation forecast to 6.8% in Q3 and 5.8% in Q4FY21. Given the positive growth impulses, the committee also upped its growth forecast to -7.5% during FY21 from -9.5% in the Oct review. Given the expected inflation and growth trajectory, we believe the committee may stay put on rates through 2021

2:53 PM

BSE Healthcare index hits new high; Sun Pharma, Laurus Labs gain up to 5%

At 02:16 pm, the S&P BSE Healthcare index was up 0.82 per cent at 20,958 points, as compared to a 0.52-per cent rise in the S&P BSE Sensex. The healthcare index hit a fresh record high of 20,991 in the intra-day trade, surpassing its previous high of 20,689 touched on September 18, 2020. READ MORE

2:44 PM

BUZZING STOCK:: IRCTC surges 14%

2:36 PM

You cannot put lakhs in difficulty for hours: RBI governor on HDFC Bank

“You see, we cannot put hundreds of thousands of customers who are using digital banking into any kind of difficulty for hours together, and especially when we are ourselves giving so much of emphasis on our digital banking, it is important that the public confidence in digital banking as today are maintained," Das said, referring to the central bank's order Thursday. READ MORE

2:28 PM

RBI eases banking and document handling procedures for exporters

Explaining the move, exporters body FIEO director general and CEO Ajay Sahai said during Covid times, many exporters have directly shipped documents to the buyers. Status holder exporters are allowed to send documents directly to buyers but others are allowed only in the case of advance payments because RBI feels that small exporters are not equipped to handle documents and should route them through banks. READ MORE

2:21 PM

Sudarshan Chemicals extends gain as Fidelity Pacific Fund buys stake

Shares of Sudarshan Chemicals gained 5 per cent higher to Rs 512 on the National Stock Exchange (NSE) in intra-day trade on Friday, thereby rising 8 per cent in the past two trading days after Fidelity Pacific Fund bought nearly one per cent stake in the company via open market. On Thursday, December 3, Fidelity Pacific Fund has bought 568,924 equity shares, representing 0.82 per cent, at Rs 463 per share on the NSE, the bulk deal data shows. READ MORE

2:09 PM

MARKET COMMENT :: Dhiraj Relli, MD &CEO, HDFC Securities on RBI Policy

The outcome of the MPC meet on Dec 04 was largely on expected lines including the status quo on rates. The Committee's assurance to continue with the accommodative stance of monetary policy as long as necessary – for the current and next year - is welcome. The MPC feels that inflation is likely to remain elevated, with some relief in the winter months from prices of perishables and bumper kharif arrivals and has raised inflation projections for H2FY21 and H1FY22. The fact that as per the RBI, CPI may not fall materially even in H1FY22 is a bit worrying.

 

The Governor did not mention about asset quality issues or their trends. In the passing he mentioned that debt servicing capacities of corporates has risen in Q2FY21 meaning that the RBI does not perceive any deterioration in asset quality from the last policy review.

 

The real GDP growth projections have been upped. While the Q4 growth projection is below expectations, the H1FY22 projections bring in a sense of relief.

 

No measures have been announced to mop up the excess liquidity in the Banking system which has arisen because of high inflation and Forex sterilization. On the other hand, the RBI has assured provision of adequate liquidity to deserving segments. The real interest rate on the short end of the curve will remain severely in the negative for some time penalizing the savers. One hopes that this does not affect the savings rate materially.

 

All in all a welcome policy announcement with RBI maintaining the liquidity rope and hinting/hoping that asset quality stress seems under control.   It seems that rates may remain on hold atleast till Mid March 2021.