The market was trading with modest losses in mid-morning trade. At 12:26 IST, the barometer index, the S&P BSE Sensex, was down 191.19 points or 0.55% at 34,677.79. The Nifty 50 index lost 44.45 points or 0.43% at 10,260.85. Surging COVID-19 cases and an IMF downgrade to economic projections dented investors' confidence.
Investors were also cautious amid media reports that China has significantly ramped up its military presence in Pangong Tso, Galwan Valley and several points in eastern Ladakh. According to the reports, People's Liberation Army of China has increased its troops and weaponry along the Line of Actual Control in Arunachal Pradesh, Sikkim and Uttarakhand. India has rubbished China's claim of sovereignty over the Galwan Valley, and said that unilateral attempt to change status quo on LAC will not be accepted.
In the broader market, the S&P BSE Mid-Cap index and the S&P BSE Small-Cap index were trading almost flat.
The market breadth was positive. On the BSE, 1294 shares rose and 1175 shares fell. A total of 124 shares were unchanged.
Trading was volatile as traders roll over positions in the F&O segment from the near month June series to July series. The June 2020 F&O contracts expires today, 25 June 2020.
IMF World Economic Outlook:
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The International Monetary Fund (IMF) on June 24 projected a sharp contraction of 4.5% for the Indian economy in 2020, a historic low, citing the unprecedented coronavirus pandemic that has nearly stalled all economic activities, but said the country is expected to bounce back in 2021 with a robust 6% growth rate.
The IMF projected the global growth at -4.9% in 2020, 1.9 percentage points below the April 2020 World Economic Outlook (WEO) forecast. Given the unprecedented nature of this crisis, as is the case for almost all countries, this projected contraction is a historic low, Gita Gopinath, IMF's Chief Economist, said as she released the World Economic Outlook Update.
Covid-19 Update:
India reported 1,86,514 active cases of COVID-19 infection and 14,894 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India. Total coronavirus cases worldwide stood at 9,430,384 far with 482,752 deaths, according to data from Johns Hopkins University.
Derivatives:
The NSE's India VIX, a gauge of market's expectation of volatility over the near term, added 0.80% to 29.81. The Nifty July 2020 futures were trading at 10,208.70, at a discount of 52.15 points compared with the spot at 10,260.85.
On the options front, the Nifty option chain for 30 July 2020 expiry showed maximum call open interest (OI) of 14.79 lakh contracts at the 11,500 strike price. Maximum put OI of 20.67 lakh contracts was seen at 10,000 strike price.
Buzzing Index:
The Nifty FMCG index rose 1.05% to 29,797.30, advancing for sixth day. The index has added 4.8% six sessions while the benchmark Nifty 50 index has gained 3.9% during the same period.
ITC (up 2.79%), Dabur India (up 1.25%), Colgate-Palmolive India (up 1.07%), Godrej Consumer (up 1.05%), Marico (up 0.66%), Tata Consumer Products (up 0.57%), Nestle India (up 0.56%), Hindustan Unilever (up 0.44%), Jubilant Foodworks (up 0.42%) and Britannia Industries (up 0.05%) advanced.
United Breweries (down 1.71%), Emami (down 0.89%), United Spirits (down 0.82%), Procter & Gamble Hygiene (down 0.54%) and Godrej Industries (down 0.28%) declined.
Earnings impact:
Bombay Burmah Trading Corporation reported 84.4% decline in consolidated net profit to Rs 90.57 crore in Q4 March 2020 as against net profit of Rs 581.33 crore in Q4 March 2019. Net sales stood at Rs 2870.84 crore in Q4 March 2020, rising 0.1% from Rs 2867.19 crore in Q4 March 2019. The scrip rose 0.94% to Rs 1056.55.
Indoco Remedies shed 1.38% to Rs 208, extending decline for second day. The stock has lost 6.4% in two days. The company's consolidated net profit fell 53.4% to Rs 5.36 crore on 7.4% rise in net sales to Rs 263.14 crore in Q4 March 2020 over Q4 March 2019.
On a standalone basis, the company's tumbled 53.6% to Rs 5.4 crore on 7.4% increase in net sales to Rs 263.17 crore in Q4 March 2020 over Q4 March 2019. EBITDA rose 16.84% to Rs 33.30 crore during the quarter. EBITDA margin stood at 12.7% in Q4 FY20, higher than 11.7% in Q4 FY19. The domestic formulation business grew by 10.3% and the international formulation business rose 12.5% during the quarter.
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