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Market spurts in early trade

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Capital Market
Last Updated : May 11 2020 | 9:51 AM IST

Key benchmark indices are trading with strong gains in early trade on buying demand in early trade. At 9:24 IST, the barometer index, the S&P BSE Sensex, was up 450.01 points or 1.42% at 32,092.71. The Nifty 50 index was up 123.45 points or 1.33% at 9,374.95. Positive global cues boosted sentiment.

The S&P BSE Mid-Cap index was up 1.36%. The S&P BSE Small-Cap index was up 0.94%.

The market breadth, indicating the overall health of the market, was strong. On the BSE, 895 shares rose and 261 shares fell. A total of 67 shares were unchanged.

Cues to watch:

Prime Minister Narendra Modi will hold a video conference with Chief Ministers today, 11 May 2020 at 15:00 IST. Officials, including Union Home Minister, Health Minister, Chief Secretary, Home Secretary, Health Secretary and the DGP will also attend the video conference. This will be the fifth interaction between PM Modi and the chief ministers since the COVID-19 outbreak began in India.

Finance Minister Nirmala Sitharaman will hold a review meeting with CEOs of public sector banks (PSBs) today to discuss various issues, including credit offtake, as part of efforts to prop up the economy hit by the COVID-19 crisis. The meeting, to be held via video-conferencing, will also take stock of interest rate transmission to borrowers by banks and progress on moratorium on loan repayments, as per reports.

Meanwhile, the government on May 8 said the estimated gross market borrowing in the financial year 2020-21 will be Rs 12 lakh crore in place of Rs 7.80 lakh crore as per BE 2020-21. The revision in borrowings has been necessitated on account of the COVID-19 pandemic.

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Stocks in news:

Reliance Industries (RIL) advanced 2.27%. The Rights Issue Committee constituted by the Board of Directors of the company has fixed 14 May 2020 as the 'Record Date' for the purpose of determining the equity shareholders entitled to receive the rights entitlement in the rights issue.

ICICI Bank fell 0.59%. ICICI Bank said its net profit rose 26.04% to Rs 1,221.36 crore on 12.09% rise in total income to Rs 23,443.66 crore in Q4 March 2020 over Q4 March 2019. The resut was announced on Saturday, 9 May 2020.

Profit before tax stood at Rs 1422.65 crore in Q4 FY20, up by 81.92% from Rs 781.98 crore in Q4 FY19. Net interest income (NII) increased by 17% year-on-year to Rs 8,927 crore in Q4 FY20 from Rs 7,620 crore in Q4 FY19. The net interest margin was at 3.87% as on 31 March 2020 as compared to 3.72% as on 31 March 2019.

Shree Cement rose 1.42%. On a consolidated basis, Shree Cement's net profit jumped 57.6% to Rs 535.93 crore on 2.1% decline in net sales to Rs 3,415.14 crore in Q4 March 2020 over Q4 March 2019. The profit was aided by an improved operational performance. Profit before tax (PBT) rose 45.39% to Rs 616.36 crore in Q4 March 2020 over Q4 March 2019.

Cipla rose 0.72%. Cipla said that following the inspection by the United States Food and Drug Administration (USFDA) at active pharmaceutical ingredient (API) manufacturing facility in Bommasandra, Bangalore from 20 January 2020 to 24 January 2020, the company has received the Establishment Inspection Report (EIR), indicating closure of the inspection.

Lupin gained 1.29%. Lupin informed that the inspection of its three units at Pithampur in Madhya Pradesh by the UK health regulator has been completed. The Medicines and Healthcare products Regulatory Agency (MHRA) of the UK conducted the inspection of the three units at Pithampur (Unit I, Unit II and Unit III) in January 2020, Lupin said in a statement.

Global Markets:

Overseas, Asian stocks followed Wall Street higher on Monday as investors looked ahead to more countries restarting their economies.

U.K. Prime Minister Boris Johnson outlined over the weekend a conditional plan to slowly reopen society and the economy. Disney is also set to reopen its Disneyland theme park in Shanghai on Monday.

Italian Prime Minister Giuseppe Conte said over the weekend Italy could ease its lockdown measures earlier than planned if the outbreak remains under control. Meanwhile, the most populous state in Australia will let restaurants, playground and outdoor pools resume operations on Friday, the region's premier said Sunday.

In US, stock market ended sharply higher on Friday (8 May) despite grim monthly jobs report as investors bet the worst of the coronavirus crisis has passed. Investors also hoped for an eventual reopening of the economy.

The Dow Jones Industrial Average rose 455.43 points, or 1.9%, to close at 24,331.32 and the S&P 500 index gained 48.61 points, or 1.69% to end the session at 2,929.80. The Nasdaq Composite Index advanced 141.66 points, or 1.58%, to 9,121.32.

The monthly report on the employment situation in the US showed that 20.5 million jobs were eliminated in April, and the unemployment rate rocketed 14.7% from 4.4% last month.

Sentiment was also aided after top US and Chinese trade representatives played down deep differences and said they would press ahead with implementing their Phase 1 trade deal. US Trade Representative Robert Lighthizer discussed the deal with Chinese Vice Premier Liu He and US Treasury Secretary Steven Mnuchin on the phone call. The US officials said in a joint statement that both sides agreed the obligations would be met.

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First Published: May 11 2020 | 9:26 AM IST

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