The domestic equity benchmarks ended with small losses on Friday. The Nifty held above the 15,650 mark. Banks shares corrected after the Reserve Bank of India's monetary policy outcome.
As per provisional closing data, the barometer index, the S&P BSE Sensex, declined 132.38 points or 0.25% to 52,100.05. The Nifty 50 index lost 20.10 points or 0.13% to 15,670.25.
The broader indices outperformed the benchmarks. The S&P BSE Mid-Cap index rose 0.63%. The S&P BSE Small-Cap index added 0.78%.
Buyers outpaced sellers. On the BSE, 1877 shares rose and 1300 shares fell. A total of 146 shares were unchanged.
RBI Policy Outcome:
The Reserve Bank of India (RBI) kept the policy repo rate unchanged at 4% while maintaining its accommodative stance after the conclusion of the Monetary Policy Committee (MPC) meeting today, 4 June 2021.
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RBI's MPC began its bi-monthly monetary policy deliberations on Wednesday, 2 June 2021. On the basis of an assessment of the current and evolving macroeconomic situation, the MPC at its meeting today (4 June 2021) decided to keep the policy repo rate under the liquidity adjustment facility (LAF) unchanged at 4%. Consequently, the reverse repo rate under the LAF remains unchanged at 3.35% and the marginal standing facility (MSF) rate and the Bank Rate at 4.25%.
The MPC also decided to continue with the accommodative stance as long as necessary to revive and sustain growth on a durable basis and continue to mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target going forward.
These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4% within a band of +/- 2%, while supporting growth.
CPI inflation is projected at 5.1% during 2021-22: 5.2% in Q1; 5.4% in Q2; 4.7% in Q3; and 5.3% in Q4:2021-22; with risks broadly balanced. Real GDP growth is projected at 9.5% in 2021-22, consisting of 18.5% in Q1; 7.9% in Q2; 7.2% in Q3; and 6.6% in Q4:2021-22.
The Nifty Bank index fell 1.02% to 35,286.95. The index rose 0.88% in the past two sessions.
RBL Bank (down 1.64%), SBI (down 1.44%), IDFC First Bank (down 1.40%), HDFC Bank (down 1.35%), Punjab National Bank (down 1.26%), Axis Bank (down 1.07%), Bandhan Bank (down 1.04%) and ICICI Bank (down 0.98%) declined.
Stocks in Spotlight:
Mahindra & Mahindra added 0.26% to Rs 804.15. The Ministry of Defence (MoD) signed a contract with Mahindra Telephonics Integrated Systems, a subsidiary of the company, for procuring 11 Airport Surveillance Radars for Indian Navy & Indian Coast Guard. The procurement, at a cost of Rs 323.47 crore, will be made under the 'Buy & Make' category.
RailTel Corporation of India rose 1.30% to Rs 132.45. The company said that it has received a work order worth Rs 119.72 crore from Bharat Coking Coal. The order is for implementation of MPLS-VPN services along with miscellaneous services at 340 locations of Bharat Coking Coal (BCCL) for the order is 60 months (5 years).
Gujarat State Petronet (GSPL) jumped 7.31% to Rs 306.70 after the company's consolidated net profit jumped 16% to Rs 577.51 crore on 19.5% surge in net sales to Rs 3766.95 crore in Q4 March 2021 over Q4 March 2020. Volumes declined 7.99% to 33.84 million metric standard cubic meter per day (MMSCMD) in Q4 FY21 over 36.78 MMSCMD in Q4 FY20.
Cupid tumbled 6.65% to Rs 231.70 after the company's standalone net profit dropped 38% to Rs 6.47 crore on a 4.1% decline in net sales to Rs 39.60 crore in Q4 March 2021 over Q4 March 2020.
Bharat Forge jumped 7.78% to Rs 750 after the company posted a standalone net profit of Rs 205.5 crore in Q4 FY21 as compared to a net loss of Rs 73.2 crore registered in Q4 FY20. Total revenue increased by 48.3% to Rs 1,307.4 crore in Q4 FY21 from Rs 881.2 crore posted in Q4 FY20. Surge in revenue was on the back of a strong 42.9% growth in export revenues and 9.6% growth in domestic revenues.
Quess Corp fell 1.79% to Rs 701.05. On a consolidated basis, the company posted a net loss of Rs 58 crore in Q4 FY21 as compared to a net loss of Rs 630 crore registered in Q4 FY20. net sales rose 0.3% YoY to Rs 3,004 crore in Q4 FY21. EBITDA margin slipped to 1.26% in Q4 FY21 from 5.37% in Q4 FY20.
Power Mech Projects soared 9.51% to Rs 688. HDFC Mutual Fund (MF) added 0.88% stake in the company via bulk deal on the NSE yesterday, 3 June 2021.
Global Markets:
Shares in Europe and Asia declined on Friday, following the U.S. equities that sagged amid robust economic data that stoked concerns about a pullback in central bank stimulus.
US stocks ended lower on Thursday, though they came off lows on signs President Joe Biden may be willing to compromise on corporate taxes.
Strong U.S. jobs data and record service-sector growth underscored the recovery from the pandemic. The Institute for Supply Management said its services survey rose to a record 64% in May from 62.7% in April. Also Thursday, IHS Markit said its final U.S. services purchasing managers index reading came in at 70.4 in May, its highest level since data began in 2009. A figure above 50 indicates growth in activity.
Meanwhile, private-sector employment in the US jumped by 978,000 in May, according to the ADP National Economic Report.
Further, weekly data on applications for unemployment benefits also painted a positive picture for the labor market in the US. First-time claims for benefits fell to 385,000 last week, the first reading below 400,000 since the pandemic began.
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