Market Wrap Podcast, June 1: Here's all that happened in the markets today

A volatile session on the bourses culminated near flat line on Tuesday as investors preferred to book profits after seven straight sessions of gains. That apart, a cut in GDP growth forecast by global agency Moody's and a downtick in manufacturing activity kept market participants on the sidelines.

Earlier today, Moody's said it expects the damage to the economy from the second wave of Covid-19 and the ensuing lockdowns to be restricted to the April-June 2021 quarter. Taking the slowdown into account, it now expects India's GDP in the fiscal year ending March 2022 to grow at 9.3 per cent and at 7.9 per cent in FY23.  

Moreover, data released by IHS Markit showed that domestic factory orders and production slowed to a 10-month low in May as most states restricted businesses amid localised lockdowns. The Manufacturing PMI slipped to 50.8 in May against 55.5 in April, making it one of the steepest falls.

Add to it, volumes remained thin as the 75 per cent peak margins norms come into effect from today.

Against this backdrop, the benchmark S&P BSE Sensex settled at 51,934 levels, down 2.5 points. The NSE's Nifty50, on the other hand, ended at 15,575 levels, down 8 points or 0.05 per cent. Earlier in the day, the 50-share index hit a fresh record peak of 15,660.75.

ONGC, Adani Ports, Bajaj Finance, SBI, Bajaj Auto, HUL, Tech M, and HDFC were the top gainers on the index today, up between 1 per cent and 4 per cent while JSW Steel, Tata Steel, ICICI Bank, Grasim, UltraTech Cement, SBI Life, Hero MotoCorp, and Infosys were the top laggards, down up to 2.3 per cent.

Participation in the broader market space also remained muted on Tuesday. The S&P BSE MidCap closed 0.01 per cent higher while the SmallCap index slipped 0.3 per cent.

Sectorally, barring the Nifty Media, Pharma, and IT indices, all other indices settled the day in the red. The Nifty Private Bank index was the top loser, down 1 per cent, while the Nifty IT index gained 0.11 per cent.

Global markets
 

European stocks hit fresh record highs on Tuesday, as strong metal and oil prices boosted shares of big commodity companies, while data showed euro zone manufacturing activity expanded at a record pace of 63.1 levels in May.

The pan-European STOXX 600 index gained 0.9 per cent in the first trading session of June, with the UK's blue-chip index rising 1.1 per cent. The German DAX jumped 1.3 per cent to a new record high, while France's CAC 40 added 0.7 per cent.

That apart, MSCI's index of EM stocks rose 0.7 per cent, while those in Turkey, South Africa and Russia gained between 0.2 per cent and 1.3 per cent.

In Asia, Japan's Nikkei slipped 0.2 per cent, South Korea's Kospi gained 0.5 per cent, China's Shanghai Composite added 0.26 per cent, and Australia's ASX200 fell 0.3 per cent.

In the commodities market, Brent Crude futures advanced over 2 per cent on Tuesday, nearing $71 per barrel-mark, ahead of the OPEC+ meeting scheduled later in the day.

Top developments and buzzing stocks of the day:

>> Shares of State Bank of India (SBI) hit a new record high of Rs 435 on the BSE, after they rallied 2.5 per cent in Tuesday's intra-day trade, surpassing its previous high of Rs 433.60 hit on May 28, 2021.

The stock of the state-owned lender has outperformed the market in the past one month by surging 21 per cent after it reported another strong quarterly performance in the March quarter (Q4FY21). In comparison, the S&P BSE Sensex was up 6.7 per cent during the period. Amid a sharp rally in the market price of the bank's stock, its market capitalisation is now just 4 per cent away from the momentous Rs 4-trillion mark.

>> Shares of Adani Enterprises hit a fresh record high of Rs 1,430 apiece on the BSE after they rallied 8.6 per cent in Tuesday's intra-day session. It surpassed its previous record high of Rs 1,350.5 touched on May 19, 2021. On the back of a 14 per cent rally in the past month, the company's m-cap now stands at Rs 1.55 trillion.

>> Shares of Rupa & Company surged nearly 20 per cent to Rs 476 on the BSE, also its 52-week high level, after the company reported a strong set of numbers for the quarter ended March 2021 (Q4FY21).

The apparel manufacturer returned to the black in the fourth quarter of FY21 as it posted a consolidated net profit of Rs 65.96 crore compared with a loss of Rs 4.28 crore in the corresponding quarter in the previous fiscal.

>> Indian equity markets that are trading near all-time high levels could see a record Rs 2–3 trillion equity supply in FY22 with 40 per cent of this being raised via initial public offers (IPOs), suggests a report by Jefferies.

Over the past decade, the contribution of initial public offers (IPOs) to equity fund-raising at around 27 per cent has been muted, Jefferies said. However, India's maturing internet space can change this trend going ahead with two pig players – Zomato and Paytm – looking to list this fiscal.

>> Asian markets have the potential to outperform in the global portfolio, said the latest report by Nomura, which maintained an overweight rating on India in its Asia ex-Japan portfolio. Reliance Industries (RIL), Infosys, ICICI Bank, Mahindra & Mahindra (M&M) and Dr. Reddy’s are Nomura’s preferred picks in the Indian context.

The global research and brokerage had cut the Nifty50 target to 15,340 for March 2022, which it has retained for now. Going ahead, markets will focus more on corporate earnings rather than the broad economic growth in India, the report said.