The domestic equity barometers ended with decent gains on Friday. The Nifty closed above the 15,700 mark. Metal stocks declined for fourth consecutive session.
As per provisional closing data, the barometer index, the S&P BSE Sensex, advanced 166.07 points or 0.32% to 52,484.67. The Nifty 50 index added 42.20 points or 0.27% to 15,722.20.
In the broader market, the S&P BSE Mid-Cap index gained 0.05% while the S&P BSE Small-Cap index rose 1.01%.
So far in 2021, the BSE Mid-Cap index and the BSE Small-Cap index have gained 23.77% and 39.94%, respectively. Meanwhile, the benchmark Sensex has added 9.48% during the same period.
The market breadth was strong. On the BSE, 1909 shares rose and 1307 shares fell. A total of 132 shares were unchanged.
COVID-19 Update:
Total COVID-19 confirmed cases worldwide stood at 18,26,45,084 with 39,55,756 deaths. India reported 5,09,637 active cases of COVID-19 infection and 4,00,312 deaths while 2,95,48,302 patients have been discharged, according to the data from the Ministry of Health and Family Welfare, Government of India.
India on Friday, 2 July 2021 reported 46,617 new cases and 853 deaths, as per health ministry's updated data. Total recoveries have jumped to 59,384.
Economy:
The Reserve Bank of India (RBI) released the 23rd issue of the Financial Stability Report (FSR), which reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on risks to financial stability and the resilience of the financial system in the context of contemporaneous issues relating to development and regulation of the financial sector.
According to the RBI, sustained policy support, benign financial conditions and the gathering momentum of vaccination are nurturing an uneven global recovery. Policy support has helped in shoring up financial positions of banks, containing non-performing loans and maintaining solvency and liquidity globally.
On the domestic front, the ferocity of the second wave of COVID-19 has dented economic activity, but monetary, regulatory and fiscal policy measures have helped curtail the solvency risk of financial entities, stabilise markets, and maintain financial stability. The capital to risk-weighted assets ratio (CRAR) of scheduled commercial banks (SCBs) increased to 16.03% and the provisioning coverage ratio (PCR) stood at 68.86% in March 2021.
Macro stress tests indicate that the gross non-performing asset (GNPA) ratio of SCBs may increase from 7.48% in March 2021 to 9.80% by March 2022 under the baseline scenario; and to 11.22% under a severe stress scenario, although SCBs have sufficient capital, both at the aggregate and individual level, even under stress.
Going forward, as banks respond to credit demand in a recovering economy, they will need to reinforce their capital and liquidity positions to fortify themselves against potential balance sheet stress.
Buzzing Index:
The Nifty Metal index fell 1.47% to 5,130.65. The index has declined 3.03% in four sessions.
Adani Enterprises (down 4.68%), Tata Steel (down 2.28%), Welspun Corp (down 2.27%), SAIL (down 2.05%), MOIL (down 1.81%), Jindal Steel & Power (down 1.75%), JSW Steel (down 1.40%) and Hindalco Industries (down 0.75%) declined.
Stocks in Spotlight:
Eicher Motors shed 0.45% to Rs 2662.10. The company said that total motorcycles sales rose 13% to 43,048 units in June 2021 from 38,065 units in June 2020. Sequentially, the company's total motorcycles jumped 57.7% in June 2021 from 27,294 units sold in May 2021.
Hero MotoCorp lost 0.02% to Rs 2921.45. The two-wheel major's total sales grew 3.80% to 4,69,160 units in June 2021 as against 4,51,983 units in June 2020. Sequentially, total sales soared 156.30% in June 2021 from 1,83,044 units in May 2021.
Coal India gained 1.44% at Rs 147.75. On a provisional basis, the company's coal production rose 2% to 40 million tonnes and coal offtake surged 23% to 51.3 million tonnes in June 2021 over June 2020.
NMDC lost 0.92% at Rs 182.75. While the state-owned miner's iron ore production climbed 18.25% to 2.98 million tonnes (MT), iron ore sales jumped 28.23% to 3.18 MT in June 2021 over June 2020.
Adani Ports and Special Economic Zone (APSEZ) rose 1.13% to Rs 711. The company said it handled cargo volume of 25.54 MMT in June 2021, registering a growth of 83% on year on year basis. In the container segment, APSEZ handled container volume of 0.67 million Twenty-foot Equivalent Units (TEUs) last month, registering a growth of 48% on a YoY basis.
Garden Reach Shipbuilders & Engineers rose 1.36% to Rs 204.40. The company has been awarded an export order for construction and supply of six Patrol Boats, through competitive bidding at the cost of $1,821,798.00, from the Department of Fisheries, Government of the People's Republic of Bangladesh.
NCC rose 3.44% to Rs 90.20. The company said it has received five new orders totaling to Rs 2,149 crore in June 2021. Out of the total orders, two orders are valued at Rs 1,254 crore pertains to water & environment division, one order of Rs 729 crore pertains to buildings division and one order worth Rs 166 crore pertains to Mining division. These orders are received from PSU/ Central/ State Government agencies and do not include any internal orders.
Global Markets:
European shares advanced while Asian shares ended mostly lower on Friday, 2 July 2021, as investors turned cautious ahead of the U.S. jobs report set to be released later in the day today.
In Europe, German retail sales figures for May and Euro zone's producer prices data for the month of May are due before the bell today.
The S&P 500 reached its sixth consecutive all-time closing high on Thursday, as a new quarter and the second half of the year began with upbeat economic data and a broad-based rally.
The number of Americans applying for unemployment aid fell again last week. The Labor Department reported Thursday that jobless claims dropped by 51,000 to 364,000.
The International Monetary Fund raised its 2021 U.S. growth projection sharply to 7% due to a strong recovery from the COVID-19 pandemic and an assumption that much of President Joe Biden's infrastructure and social spending plans will be enacted.
The IMF's latest forecast, marking the fastest U.S. growth pace since 1984, compares with an April projection of 4.6% growth in 2021. The Fund raised its 2022 U.S. GDP growth forecast to 4.9%, up from its previous 3.5% April forecast.
On Thursday, following two days of talks, 130 countries pledged support for the U.S. proposal of a global minimum corporate tax of 15%.
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