Domestic markets are trading with strong gains in early trade on upbeat global cues. At 9:24 IST, the barometer index, the S&P BSE Sensex, was up 615.08 points or 1.79% at 34,902.32. The Nifty 50 index was up 178.25 points or 1.76% at 10,320.40.
The S&P BSE Mid-Cap index was up 1.19%. The S&P BSE Small-Cap index was up 1.95%.
The market breadth, indicating the overall health of the market, was strong. On the BSE, 1346 shares rose and 221 shares fell. A total of 72 shares were unchanged.
Easing of lockdown:
Union Ministry of Home Affairs (MHA) issued guidelines for a phased-wise reopening of the economy from 1 June 2020. The new rules allow religious places, shopping malls, hotels and restaurants to open from today, 8 June. The government has decided to allow all activities prohibited earlier in areas outside containment zones in a phased manner. The lockdown was first enforced in March to contain the spread of COVID-19.
Stocks in news:
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Reliance Industries (RIL) rose 1.42%. RIL and Jio Platforms on Sunday announced an investment of Rs 5,683.50 crore by a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA). This investment values Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore. ADIA's investment will translate into a 1.16% equity stake in Jio Platforms on a fully diluted basis.
Separately, RIL announced that Silver Lake and its co-investors will invest an additional Rs 4,546.80 crore in Jio Platforms, in addition to the Rs 5,655.75 crore of investment by Silver Lake announced on 4 May 2020. This brings the aggregate investment by Silver Lake and its co-investors to Rs 10,202.55 crore.
Silver Lake's investment values Jio Platforms at an equity value of Rs 4.91 lakh crore and an enterprise value of Rs 5.16 lakh crore, and will translate into a 2.08% equity stake in Jio Platforms on a fully diluted basis.
Larsen & Toubro (L&T) gained 3.51%. The company's consolidated net profit fell 6.5% to Rs 3197.07 crore on 2.2% rise in net sales to Rs 44245.28 crore in Q4 March 2020 over Q4 March 2019. Profit before tax (PBT) stood at Rs 4382.13 crore in Q4 FY20, down by 14.9% from Rs 5150.61 crore in Q4 FY19.
Vedanta slipped 0.33%. On a consolidated basis, Vedanta reported a net loss of Rs 12,521 crore in Q4 March 2020 as against net profit of Rs 2,615 crore in Q4 March 2019. The profit was impacted by exceptional loss of Rs 17,132 crore in Q4 FY20 due to impairment of assets at oil & gas, copper and iron ore business. Revenue from operations declined 16% to Rs 19,513 crore in Q4 March 2020 from Rs 23,092 crore in Q4 March 2019. Revenue fell due to lower commodity prices further impacted by COVID-19, lower volumes at zinc, oil & gas, steel business and lower power sales at Talwandi Sabo Power Limited partially offset by higher volume at aluminium and iron ore business, and rupee depreciation.
IndusInd Bank surged 6.05%. The promoters, IndusInd International Holdings Ltd. and IndusInd Ltd., presently hold 14.68% of the paid-up share capital of the bank. The promoters shall now purchase additional shares from the open market within the overall regulatory limit prescribed for promoter equity holding cap.
Alkem Laboratories rose 0.3%. The company's consolidated net profit surged 12.8% to Rs 188.80 crore on 10.6% rise in net sales to Rs 2049 crore in Q4 March 2020 over Q4 March 2019.
Exide Industries lost 6.13% after consolidated net profit dropped 22.2% to Rs 235.57 crore on 18.3% fall in net sales to Rs 3,474.68 crore in Q4 March 2020 over Q4 March 2019.
Global Markets:
Overseas, Asian stocks are trading higher on Monday after a surprise recovery in US employment gave further confidence of a quick economic recovery after many weeks of lockdowns aimed at controlling the coronavirus pandemic. The Australian share market was closed for a holiday.
China's exports in May fell 3.3% compared with a year earlier, but imports plunged 16.7%, customs data showed on Sunday. China posted a trade surplus of $62.93 billion last month, compared with $45.34 billion surplus in April.
In US, stocks ended sharply higher on Friday after jobs report showed surprise jump in payrolls, fall in unemployment rate. Shares of airlines jumped, as the industry added more summer flights.
The Dow Jones Industrial Average jumped 829.16 points, or 3.2%, to 27,110.98, while the S&P 500 rose 81.58 points, or 2.6%, to 3,193.93. The Nasdaq Composite advanced 198.27 points, or 2.1%, to 9,814.08, after hitting a record intraday high of 9,845.69.
In economic data, the Labor Department said non-farm payroll employment jumped by 2.51 million jobs in May after plummeting by a revised 20.69 million jobs in April. Employment rose sharply in leisure and hospitality, construction, education and health services, and retail trade, according to the Labor Department.
The Labor Department claimed the improvements in the labor market reflected a limited resumption of economic activity that had been curtailed in March and April due to the coronavirus pandemic and efforts to contain the spread of the disease.
With the unexpected rebound in employment, the Labor Department said the unemployment rate dropped to 13.3% in May from 14.7% in April.
Back home, domestic shares ended with strong gains on Friday (5 June) as persistent foreign fund inflows and positive cues from global markets boosted sentiment. Investors focused on early signs of some improvement in the economy amid gradual lifting of lockdown measures in India. The barometer S&P BSE Sensex gained 306.54 points or 0.9% at 34,287.24. The Nifty 50 index rallied 113.05 points or 1.13% at 10,142.15. The broad-based rally was led by banks and metal shares.
Foreign portfolio investors (FPIs) bought shares worth Rs 97.61 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 47.29 crore in the Indian equity market on 5 June, provisional data showed.
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