Domestic equity indices extended gains for second straight day on Wednesday. Global cues were mixed ahead of the US Federal Reserve's policy outcome later in the day.
The barometer index, the S&P BSE Sensex added 258.50 points or 0.66% at 39,302.85. The Nifty 50 index gained 82.75 points or 0.72% at 11,604.55. Both the indices have risen 1.4% in two sessions.
The broader market advanced for third trading session after the Sebi on 11 September issued a circular mandating multi cap funds to allocate least 25% of their portfolios in large-, mid- and small-caps each by February 2021.
The BSE Mid-Cap index rose 0.21% and the BSE Small-Cap index gained 0.44%. In three sessions, the midcap index and the smallcap index have added 2.63% and 5.99%, respectively.
Buyers outpaced sellers. On the BSE, 1417 shares rose and 1316 shares fell. A total of 204 shares were unchanged.
COVID-19 Update:
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Total COVID-19 confirmed cases worldwide stood at 29,479,686 with 9,33,542 deaths. India reported 9,95,933 active cases of COVID-19 infection and 82,066 deaths while 39,42,360 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
Economy:
India's exports slipped 12.66% to $22.7 billion in August, on account of decline in the shipments of petroleum, leather, engineering goods and gems and jewellery items, according to the government data released on 15 September 2020. The country's imports too declined 26% to $29.47 billion in August, leaving a trade deficit of $6.77 billion, compared to a shortfall of $13.86 billion in the same month last year, as per the data.
Numbers to Watch:
The yield on 10-year benchmark federal paper fell to 5.995% as compared with 6.029% 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 73.52, compared with its close of 73.6450 during the previous trading session.
In the commodities market, Brent crude for November 2020 settlement rose 93 cents at $41.46 a barrel. The contract rose 92 cents, or 2.32% to settle at $40.53 a barrel in the previous trading session.
Foreign Markets:
The US Dow Jones Futures 30 were trading 142 points higher, indicating a good start in US markets today. European shares were trading lower while Asian stocks ended mixed on Wednesday.
Investors await the outcome of a two-day meeting of the U.S. Federal Reserve's Federal Open Market Committee (FOMC). The FOMC will also provide its quarterly update on its estimates for GDP, unemployment and inflation and could provide clearer guidance on what it will take to raise rates in the future. The Bank of Japan and the Bank of England will announce their respective policy decisions on Thursday.
Yoshihide Suga was elected as Japan's prime minister on Wednesday, becoming the country's first new leader in nearly eight years.
Meanwhile, provisional trade statistics from Japan's Ministry of Finance released Wednesday showed the country's exports in August falling 14.8% as compared to a year ago.
US stocks closed mostly higher on Tuesday, 15 September 2020, with broader Nasdaq and S&P 500 both closing firmly in positive territory, on the hope the Federal Reserve would stick with its accommodative policy as the central bank's two-day meeting got underway. The Dow gave back early gains to end the session nearly unchanged due to weakness in Apple (AAPL), Caterpillar (CAT), JPMorgan Chase (JPM) and Travelers (TRV).
Meanwhile, U.S. industrial production slowed by much more than expected in August. The Fed said industrial production climbed by 0.4% in August after soaring by an upwardly revised 3.5% in July.
A separate report from the Labor Department showed another notable increase in U.S. import prices in the month of August, with prices jumping by much more than expected.
Shares of Apple pulled back well off their early highs, edging up by just 0.2% after the company wrapped up an event to showcase new products. The tech giant launched a new Apple Watch and a bundle for its services, such as Apple Music.
Buzzing Indian Segments:
The Nifty Auto index rose 1.53% to 8,156.20. The index has risen 4.03% so far this month.
Mahindra & Mahindra (up 4.24%), Bajaj Auto (up 3.44%), Tata Motors (up 2.23%), Escorts (up 2%), TVS Motor (up 1.52%) and Ashok Leyland (up 1.28%) advanced.
The Nifty Pharma index rose 2.08% to 11,688.55. The index has risen 4.05% in two sessions.
Cadila Healthcare (up 3.69%), Lupin (up 2.72%), Strides Pharma Science (up 2.69%), Sun Pharmaceutical Industries (up 2.5%), Ipca Laboratories (up 2.39%) advanced.
Dr. Reddy's Laboratories jumped 4.24% after the drug major announced that it has partnered with Russian Direct Investment Fund (RDIF) to cooperate on clinical trials and distribution of Sputnik V vaccine in India. Upon regulatory approval in India, RDIF shall supply to Dr. Reddy's 100 million doses of the vaccine. The Sputnik V vaccine, which is based on well-studied human adenoviral vector platform with proven safety, is undergoing clinical trials for the coronavirus pandemic.
Aurobindo Pharma rose 1.66% after the drug maker announced a collaboration with the Council of Scientific and Industrial Research (CSIR) to develop vaccines against Covid-19. Apart from this collaboration, Aurobindo is already developing a vaccine for SARS COV-2 through its wholly-owned US subsidiary Auro Vaccines.
Divis Laboratories rose 1.84%. SMS Pharmaceuticals jumped 5.29%.
SMS Pharmaceuticals clarified to the bourses that it strongly condemned the media reports suggesting Divis Laboratories acquiring stake in SMS Pharmaceuticals or its group companies.
Separately, Divis Laboratories also denied the news report. Neither the Company nor the promoters have any intention or plans or discussions to acquire stake in SMS Pharmaceuticals Limited or any of its group companies. The Company has always been relying on organic growth, it said in a statement.
Stocks in Spotlight:
Realty major DLF jumped 5.08%. The media reported that the company saw sales of over Rs 250 cr in the June-August period, pointing to a revival in the luxury property space.
Vedanta rose 2.32%. A three-judge Superme Court (SC) Panel headed by Justice S Abdul Nazeer, reportedly rejected the government's petition challenging the enforcement of a Malaysian arbitral award passed in favour of Vedanta in relation to the Ravva oil and gas fields. SC held that the enforcement of this award will not go against the public policy of India, media reports said.
Sterlite Technologies jumped 3.78%. The company announced a partnership with Bharti Airtel to build a modern optical fibre network for Airtel across 10 telecom circles. This modern optical network will enable Airtel to deliver world-class customer experience through enhanced scalability, reduced latency, and improved bandwidth. The densely fiberized, future-ready network, will also form the foundation for many next-gen services such as 5G, FTTH, IoT, enterprise networks, and Industry 4.0.
National Fertilizer (NFL) spurted 4.39% after the company posted a consolidated net profit of Rs 108.31 crore in Q1 June 2020 as compared to a consolidated net loss of Rs 64.07 crore in Q1 June 2019. Consolidated net sales for Q1 June 2020 stood at Rs 2831.85 crore, rising 11.2% from Rs 2,547.04 crore in Q1 June 2019. During the quarter ended 30 June 2020, NFL's production, dispatches, sales and market collections largely remained unaffected. The company has been able to operate all its five plants at normal levels except for restriction in load for few days due to limitation of supply of bags.
SpiceJet dropped 0.56%. The low-cost air carrier reported a consolidated net loss of Rs 600.52 crore in Q1 June 2020 compared with net profit of Rs 262.89 crore in Q1 June 2019. Net sales during the quarter slumped 83.2% year-on-year (YoY) to Rs 489.60 crore, as flight operations remained suspended for most part of the quarter following the nationwide lockdown. On an EBITDA basis, loss was Rs 11 crore for the reported quarter as against profit of Rs 747.5 crore for the corresponding quarter last year. On an EBITDAR basis, the profit was Rs 13.5 crore for the reported quarter as against profit of Rs 812.1 crore for the same quarter last year.
Procter & Gamble Health fell 4.10%. The FMCG company reported 10.8% increase in net profit to Rs 48.86 crore on 13.9% fall in net sales to Rs 201.16 crore in the quarter ended 30 June 2020 compared with the same period last year. Profit before tax in the June 2020 quarter stood at Rs 55.73 crore, down by 17.4% from Rs 67.50 crore in the June 2019 quarter. Current tax expense during the quarter declined 28.9% year-on-year (YoY) to Rs 15.71 crore.
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