Domestic shares extended gains for the fourth straight session on Thursday, tracking positive global cues. The barometer S&P BSE Sensex gained 997.46 points or 3.05% at 33,717.62. The Nifty 50 index added 306.55 points or 3.21% at 9,859.90. Trading was volatile on account of the monthly F&O expiry today.
In the broader market, the S&P BSE Mid-Cap index rose 1.46% while the S&P BSE Small-Cap index advanced 1.15%. Both these indices trailed the Sensex.
The market breadth was positive. On the BSE, 1343 shares rose and 1095 shares fell. A total of 168 shares were unchanged.
The Nifty 50 index jumped 7.71% in four trading sessions. It has spurted 31.27% from the 52-week low of 7,511.10 hit on 24 March 2020.
Global shares climbed following developments overnight regarding the use of Gilead Sciences' antiviral drug remdesivir as a potential new treatment for Covid-19 patients. Sentiment also improved after China said manufacturing activity in the country expanded slightly in April.
Buying was also triggered after foreign portfolio investors (FPIs) turned net buyers of Indian equities on Wednesday (29 April). FPIs bought shares worth a net Rs 785.15 crore on 29 April 2020.
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Total Covid-19 confirmed cases worldwide stood at 32,09,984 so far with 2,28,057 deaths. India reported 24,162 active cases of COVID-19 infection and 1,075 deaths, according to the data from the Ministry of Health and Family Welfare, Government of India.
India will finish its nation-wide lockdown on 3 May. Media reports have indicated that the government will push for staggered lockdown, freeing up green zones and non-containment COVID-19 areas.
Numbers to Track:
In the foreign exchange market, the partially convertible rupee edged higher to 75.0925 compared with its previous closing of 75.66.
The yield on 10-year benchmark federal paper fell to 6.110% as compared with 6.125% in the previous trading session.
MCX Gold futures for 5 June 2020 settlement added 0.35% to Rs 45,704.
In the commodities market, Brent crude for June 2020 settlement was up $2.55 to $25.09 a barrel. The contract rose $2.08 or 10.16% to settle at $22.54 a barrel in the previous trading session.
Global Markets:
Shares in Europe and Asia advanced on Thursday as US scientists on Wednesday (29 Apr) hailed a potential breakthrough in the coronavirus fight as a trial showed patients responding to antiviral drug remdesivir, fuelling global hopes for a return to normal.
Gilead Sciences said Wednesday preliminary results of a coronavirus drug trial showed at least 50% of patients treated with a five-day dosage of remdesivir improved and more than half were discharged from the hospital within two weeks.
On the economic data front, China said manufacturing activity in the country expanded slightly in April. The official manufacturing Purchasing Managers' Index for April came in at 50.8, as compared to 52 in March. PMI readings above 50 indicate expansion, while those below that level signal contraction.
In US, markets surged on Wednesday as hopes for an effective COVID-19 treatment prompted a broad rally and helped investors shrug off words of warning from US Federal Reserve Chair Jerome Powell.
Meanwhile, US Federal Reserve policymakers on Wednesday left interest rates near zero and repeated a vow to do what it takes to shore up the economy, saying the ongoing coronavirus pandemic will weigh heavily on the near-term outlook and poses considerable risks for the medium term.
On the economic data front, the Commerce Department says the gross domestic product, the total output of goods and services, posted a quarterly drop for the first time in six years. The US economy shrank at a 4.8% annual rate last quarter as the coronavirus pandemic shut down much of the country.
Buzzing Indian Segments:
The Nifty Metal index spurted 7.90% to 1,859.90, outperforming the other sectoral indices on the NSE. The index rose 11.93% in two sessions.
Vedanta (up 13.20%), Hindalco Industries (up 11.99%), JSW Steel (up 10.20%), Jindal Steel & Power (up 7.22%), NMDC (up 6.69%), SAIL (up 5.63%), NALCO (up 3.07%), Hindustan Copper (up 2.15%) and Hindustan Zinc (up 1.84%) surged.
Tata Steel rallied 5.65%. The steel major announced on Thursday, 30 April 2020, that the committee of directors has approved allotment of 10,000 unsecured, rated, listed, redeemable, NCDs of face value Rs 10 lakh each, for cash aggregating to Rs 1,000 crore, to identified investors on private placement basis.
The issue consists of two separate series of NCDs. Series 'A' consists 5,000 NCDs worth Rs 500 crore with 7.85% per annum floating coupon rate. Series B consists 5,000 NCDs worth Rs 500 crore with 7.95% per anum fixed coupon rate. The NCDs are proposed to be listed on the wholesale debt market segment of BSE.
The Nifty Auto index surged 6.45% to 5,901.40. The index rose 9.75% in four sessions.
Hero MotoCorp (up 9.94%), Ashok Leyland (up 9.18%), TVS Motor Company (up 6.65%), Maruti Suzuki India (up 5.76%), Mahindra & Mahindra (up 5.33%), Bajaj Auto (up 5.11%) and Eicher Motors (up 2.18%) advanced.
Tata Motors surged 19.13% to Rs 93.10 after the media reported that Jaguar Land Rover (JLR) has restored three-fourth of its budgeted production in China.
Stocks in Spotlight:
FMCG major Hindustan Unilever (HUL) fell 1.63% to Rs 2195.70. The company's net profit fell 1.24% to Rs 1,519 crore on 9.42% decline in net sales to Rs 8,885 crore in Q4 March 2020 over Q4 March 2019. The result was announced after market hours today.
HUL said the spread of COVID-19 impacted the business from mid-March, which culminated into scaling down of operations post the national lockdown. Domestic Consumer Growth declined by 9% with a decline of 7% in underlying volume growth. Reported EBITDA margin reduced by 40 bps (160 bps reduction on comparable basis after adjusting for accounting impact of Ind AS 116). "In this challenging economic context, HUL performance has been competitive with corporate market share gains," the company said.
Sanjiv Mehta, chairman and managing director commented: COVID-19 is perhaps the biggest challenge for us both from the lens of sustaining lives as well as livelihoods. The human impact of the pandemic is uncertain, and we are fully committed to working with the Government and our partners to ensure that we overcome this crisis together. Our portfolio of trusted brands, our financial stability and quality of leadership teams positions us well to deal with the crisis and, for the changing world that will come afterwards. With the GSK CH merger effective from 1st April, iconic brands such as Horlicks and Boost will now enable us to also address the nutrition needs of consumers. Our approach will be to protect our business model, grow competitively and contribute to the nation."
Index heavyweight Reliance Industries (RIL) rose 2.86% ahead of its Q4 earnings today.
Tech Mahindra rose 3.26% to Rs 546.10. The IT firm's profit after tax (PAT) fell 29.9% to Rs 804 crore on 1.7% decline in revenue to Rs 9,490 crore in Q4 March 2020 over Q3 December 2019. EBITDA fell 13.8% to Rs 1,348 crore in Q4 March 2020 over Q3 December 2019. EBITDA margins fell 200 bps to 14.2% in Q4 March 2020 over Q3 December 2019. The result was announced after market hours today.
Mahindra & Mahindra Financial Services jumped 5.80% after the company said it completed the proceedings for divestment of 49% stake in its asset management subsidiary to Manulife. Manulife has invested $35 million (about Rs 265 crore) in the 51:49 joint venture, which aims to expand its fund offerings, drive fund penetration and achieve long term wealth creation in India.
The joint venture brings together Mahindra Finance's domestic market strength and track record of building successful businesses and partnerships, with Manulife's global wealth and asset management capabilities and richness of experience in servicing the needs of consumers in Asia and around the world.
UPL spurted 16.53%. the chemical maker expects its net debt to be at approximately $2.9 billion as of 31 March 2020, lower than $3.8 billion as of 31 March 2019 and $4.2 billion as of 31 December 2019. The same represents a reduction in net debt of approximately $900 million and $1.3 billion as compared to 31 March 2019 and 31 December 2019, respectively. The company has cash/cash equivalent of approximately $875 million as of 31 March 2020. UPL further stated that it presently continues to see demand in line with the expectations as the farming season continues to be normal across the world. This is being supported by governments across the world to strengthen their security of food supply.
Glenmark Pharmaceuticals surged 2.27% after it received approval from the DCGI (Drug Controller General of India), the regulator in India, to conduct clinical trials on Favipiravir Antiviral tablets on COVID-19 patients. The product is a generic version of Avigan of Fujifilm Toyama Chemical, Japan, a subsidiary of Fujifilm Corporation.
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