Key benchmark indices scaled fresh hit intraday high in afternoon trade, supported by strength in financials and auto stocks. The barometer index, the S&P BSE Sensex jumped 505.79 points or 1.35% at 37,924.78. The Nifty 50 index gained 141.65 points or 1.29% at 11,163.85.
Global shares advanced as European Union (EU) leaders agreed on a 750 billion euros package aimed at funding post-pandemic relief efforts in the region.
Hopes for a coronavirus vaccine also lifted risk appetite. The first set of results from early-stage clinical trials of the Oxford University Covid-19 vaccine candidate show the vaccine is safe and induces an immune reaction.
The broader market underperformed the benchmark indices. The S&P BSE Mid-Cap index rose 0.29% while the S&P BSE Small-Cap index rose 0.55%.
The market breadth was positive. On the BSE, 1,380 shares rose and 1,119 shares fell. A total of 152 shares were unchanged. In Nifty 50 index, 34 stocks advanced while 16 stocks declined.
Foreign portfolio investors (FPIs) bought shares worth Rs 1,709.97 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 1,521.99 crore in the Indian equity market on 20 July, provisional data showed.
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COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 1,47,06,950 far with 6,09,971 deaths. India reported 4,02,529 active cases of COVID-19 infection and 28,084 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India.
Sebi Regulation:
Markets regulator Securities and Exchange Board of India (SEBI) on Monday released framework to enable verification of upfront collection of margins from clients in cash and derivatives segments. The new framework will come into effect from 1 December 2020 and will be implemented in a phased manner. From 1 September 2021, investors and traders will have to pay all the margins upfront to the broker before the trade. Currently, the rule of bringing in the entire upfront margins is only applicable to traders in derivatives.
Gainers & Losers:
Index heavyweight Reliance Industries was up 2.48% to Rs 1966.95.
BPCL (up 7.29%), IOCL (up 6.17%), HDFC (up 4.26%), Maruti Suzuki India (up 4.13%) and Eicher Motors (up 4.12%) were other major gainers.
Britannia Industries (down 2.20%), Bharti Infratel (down 1.65%), Hindalco Industries (down 1.55%), Cipla (down 1.51%) and Sun Pharmaceutical Industries (down 1.30%) were major losers.
Q4 Results Today:
Hindustan Unilever (down 0.18%), Axis Bank (up 2.77%), Bajaj Finserv (down 0.16%), ICICI Prudential Life (up 1.33%), SBI Life Insurance Company (up 0.32%), HDFC Life Insurance Company (down 0.29%), Crisil (up 0.67%), DCM Shriram (down 0.06%), IndiaMART InterMESH (up 2.30%) and Syngene International (up 0.72%) will announce their quarterly earnings today.
Earnings Impact:
Bajaj Finance rose 0.30%. The NBFC's consolidated net profit tumbled nearly 20% to Rs 962.32 crore in Q1 June 2020 (Q1FY21) from Rs 1,195.25 crore posted in Q1 June 2019 (Q1FY20). Consolidated total revenue from operation jumped 14.5% to Rs 6,648.20 crore in Q1FY21 as against Rs 5,805.48 crore posted in the same period last year. Consolidated Profit before tax (PBT) stood at Rs 1,309.69 crore in Q1FY21, falling 30% from Rs 1,851.42 crore in Q1FY20. Total tax expense fell 47% year on year to Rs 347 crore in Q1 June 2020.
SBI Cards and Payment Services spurted 6.04% after SBI's card business' net profit rose 14% to Rs 393.29 crore in Q1 June 2020 compared with Rs 345.59 crore in Q1 June 2019. The rise in the net profit was aided by reduction in operating costs (down 15.4% Y-o-Y) and finance costs (down 9% Y-o-Y). Total income stood at Rs 2,195.60 crore in Q1 June 2020, sliding 4.72% from Rs 2,304.27 crore in Q1 June 2019. During the quarter, the company's interest income increased by 34.6% Y-o-Y while income from fees & services and other income declined 27% Y-o-Y and 81% Y-o-Y, respectively. On the asset quality front, the gross non-performing assets were at 1.35% of gross advances as on 30 June 2020 as against 2.68% as on 30 June 2019. Meanwhile, accounts in moratorium went down by 88% to 1.5 lakh in June 2020 from 12.5 lakh in May 2020.
ACC advanced 4.88% after the cement major's operating EBITDA margin improved to 20.8% in Q2 June 2020 from 19.3% in Q2 June 2019 bouyed by strong cost management and efficiency actions. The company's consolidated net profit tumbled 40.5% to Rs 270.95 crore in Q2 June 2020 as against Rs 455.68 in Q2 June 2019. Revenue from operations stood at Rs 2,602.24 crore in Q2 June 2020, declining 37% from Rs 4,149.82 crore reported in the same period last year. The cement sales volume declined 34% to 4.76 million tonnes in Q2 June 2020 from 7.23 million tonnes in Q2 June 2019. The ready-mix concrete sales volume tumbled 82% to 0.15 cubic million metres in Q2 June 2020 from 0.85 cubic million metres in Q2 June 2019.
Stocks in Spotlight:
Shares of Majesco hit an upper circuit of 5% after the IT firm signed a pact to sell its US subsidiary to private equity firm Thoma Bravo. As on date, the company holds 3,21,11,234 common stock of the US subsidiary. The Nasdaq-listed arm of the Indian company will be sold at $13.1 per share. The deal, which is expected to close before end of 2020, values the US unit at $594 million. Following the closing of the transaction, the unit will operate as a privately-held company. Majesco India will get $420.66 million (about Rs 3,150 crore) from this deal compared to the total investments made by the company in US subsidiary of $68.67 million, to date. Majesco India has a current market capitalisation of Rs 1,153.19 crore.
Info Edge (India) fell 0.29%. The company entered into an agreement, through its wholly-owned subsidiary, to invest upto Rs 10.6 crore in Bizcrum Infotech (Bijnis). The company has acquired/agreed to acquire 2,869 cumulative, non-redeemable, mandatorily and fully convertible preference shares, through a mix of primary & secondary mode of acquisition, as part of a larger fund raise exercise by Bijnis including other third party investors. Upon the successful closing of the said fund raise exercise, the aggregate shareholding of the company in the said entity would be around 28.22% on fully converted & diluted basis.
Global Markets:
European and Asian markets rallied across the board on Tuesday. European Union (EU) leaders reached a deal on a 750 billion euro ($857 billion) recovery fund to help the region recover from the coronavirus crisis. EU heads of state had been locked in talks since Friday morning. Early Tuesday morning, however, the leaders reached a breakthrough agreement. Investor sentiment was also supported by a slew of positive news on the coronavirus vaccine front.
US stocks climbed on Monday after erasing early losses as tech giants rallied and investors focused on positive COVID-19 vaccine news.
A UK biotech firm, Synairgen, reportedly soared as much as 552% on Monday after announcing that its drug was associated with a significantly lower chance of a patient requiring a ventilator or dying.
Pfizer and BioNTech reported early positive data on a joint coronavirus vaccine Monday and another candidate from Oxford University and AstraZeneca also showed a positive immune response in an early trial.
Investors are also keeping an eye on Washington, where lawmakers are starting to hammer out a rescue package to replace some of the expiring benefits earlier versions contained.
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